GameStop Plans Store Closures as Business Shifts

Goodbye, GameStop? Not quite. As part of the company's 2014 Investor Day yesterday, GameStop CEO Paul Raines noted that the company will soon be closing anywhere from 120 to 130 of its retail stores by the end of the company's fiscal year.

While the move will barely put a dent in GameStop's overall inventory of 6,457 worldwide stores, the closures are intended to allow GameStop to shift its priorities a bit into diversifying its overall business model. This approach, which Raines dubs "Gamestop 3.0," calls for GameStop to double the number of its Spring Mobile and Simply Mac outlets within the company's fiscal year.

To get down to the raw figures, as reported by GamesIndustry International, GameStop will open anywhere from 200 to 250 Spring Mobile stores — even more than the number that existed as of last year (164). The company will also open anywhere from 20 to 25 Simply Mac stores, doubling the 23 stores it currently operates. GameStop will also add anywhere from 100 to 150 Cricket stores, which at least triples the 31 it currently had as of its last reported fiscal year.

Raines "seemed much more excited" about the $185 billion wireless market and $50-55 billion "Apple ecosystem" market than the $22.5 billion video game market, Ars Technica reported. That's not to say that GameStop is abandoning its plans to serve the latter; rather, Raines indicated potential for growth in the wireless and Apple areas that are not yet saturated by GameStop-owned stores.

"The buy/sell/trade model has potential applications for all of these markets," Raines said. "We were early on in seeing the potential for buy/sell/trade of phones and tablets and have by far the largest in-store presence in this category, and we expect to grow with the market."

As for GameStop's Apple-related interests, the company apparently also has Apple's blessing to pursue expansion of its Simply Mac brand. In total, GameStop has a target of 1,000 for the number of these "technology brand" stores it hopes to have operational by 2016. These stores, projects GameStop, should contribute to 10 percent of the company's total earnings by then.