GameStore shares nose-dive

Credit: Reuters Studio
Published on June 5, 2019 - Duration: 01:01s

GameStore shares nose-dive

GameStop shares lost a third of their value Thursday morning after the video games retailer halted its quarterly dividend and reported a drop in revenue.

Fred Katayama reports.

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GameStore shares nose-dive

Investors are treating GameStop as if it's "game over" - shares of the company plummeting Wednesday - losing more than a 1/3 of their value.

That, after the company reporterd Sales of video games and consoles at its stores slowed sharply, driving quarterly revenue down more than 13 percent.

What also turned off shareholders - its decision to scrap its dividend in a bid to use that money to pay down debt and boost promotions.

The retailer said consumers were putting off purchases of consoles to await new versions from Sony and Microsoft.

But its business has been declining.

Consumers are opting to download games instead of buying CDs at its stores .

Gamers are also flocking to game streaming sites such as Google's Stadia and Apple's Arcade.

Earlier this year, GameStop gave up on its efforts to sell itself.

At least five analysts lowered their price targets on the stock, which has now lost 60 percent of its value this year.

One analyst went so far as to say the latest results and the competition from streaming suggest it may be "game over" for the company.

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