GameStop - essential or not - saw foot traffic jump as people scrambled to buy games
Update: Regardless of whether or not GameStop is really an essential business, the press has been good for the stores. Reports of lines out the door as quarantined people stock up on entertainment definitely jive with a recent jump in ‘Were Here’ and 'Talking About' data for the chain. It also helps considerably that both Doom Eternal and Animal Crossing: New Horizons came out today, but we have a hunch that the recent news of potential store closures forced a lot of people to rush out to buy games, since not everyone downloads digitally.
The original story continues as published this morning:
If your plan, as a business, is to go bankrupt soon, you might as well go kicking and screaming with the police dragging you away. That's not at all what's in store for GameStop ($NYSE:GME), but it's also not far off from the truth either.
GameStop employees around the world were told yesterday to remain open by corporate, in a leaked internal memo, despite what any state authorities or governors said. GameStop wants to remain open everywhere, as they think they are "essential items" as if video games are what people desperately need in the midst of a global pandemic. For now, here's where you can get your video game fix...
The last time we wrote about GameStop was last week, and the idea was to add famous executives to the board. And next week, there's an earnings call for Q1 of 2020. According to Zacks Investment Research, based on analysts' forecasts, the consensus EPS forecast for the quarter is $0.84. Last year it was $1.45 at this time. It's an intense time to be a GameStop investor, since the retailer was already on the ropes, and shares are down about 90% in the last five years.
The stakes are very high for the gaming retailer, as the prospect of shuttering any of these stores would doom GameStop in the short term.
300 more people now work at GameStop this quarter, as tracked by our LinkedIn data, and all of these employees are at risk of losing their jobs if stores are down by local and state officials. The lockdown order has led to a lot of drama over the past 24 hours online, and many question whether its safe to keep the stores open. GameStop staggered the release of Doom Eternal and Animal Crossing to avoid crowds in stores, and even canceled midnight release parties indefinitely.
The following is an official statement released by the company, as it attempts to justify its standing as an essential retailer.
"While GameStop is best known as a provider of gaming and home entertainment systems, we also offer a wide array of products and devices that are important to facilitate remote work, distance learning, and virtual connectivity." GameStop says it is "one of many providers" that serve the "significant need for technology solutions" that many Americans are now facing as they work and learn from home.
"While there are many businesses and organizations far more critical than ours, we believe we can have a positive impact during this very challenging time," the statement continues, adding that "we are complying with all state, county, city and local ordinances and we will continue to adjust to any future developments."
About the Data:
Thinknum tracks companies using the information they post online - jobs, social and web traffic, product sales and app ratings - and creates data sets that measure factors like hiring, revenue and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.