GAME shares cut by 35% as sales continue to fall

After reporting a 10% sales decrease and stating that it would miss targets for sales and profits, shares in GAME dropped by a third on Wednesday afternoon. The disappointing sales were encountered in every department, including hardware, software, second-hand sales and accessories.

Worryingly, it also noted that revenues and profits would continue to drop further, citing ‘wider consumer uncertainty’ for the decrease in footfall and sales. The retailer has now been struggling for quite some time, reporting a near 15% decrease in sales at the start of its financial year in April. Whilst business improved in the summer, GAME was forced to cut its capital expenditure plans due to the challenging market.

Despite total sales being down by 10.6% and like-for-like sales being down 8.6% (for the 41 weeks to November 12), GAME did highlight, however, that the results were still ahead of the overall video games market, which was down 12.3% in the same period.

GAME has already closed 37 stores this year, and is attempting to develop its online sales and build customer loyalty. Unfortunately, based on the wealth of negative customer feedback on the retailer’s Facebook page – which include a raft of complaints relating to poor customer service, shipping delays and the inability to obtain refunds for returned items – its online channel may be doing more harm than good.