GameStop Set for Major Downsizing Amid Shifting Market Trends

GameStop is preparing to shut down a large number of its retail locations during fiscal year 2025 as part of a broader strategy to adapt to the changing landscape of the gaming industry. This move follows a year of significant closures, with 401 stores shuttered in January alone—nearly twice the amount closed the previous fiscal year. According to a recent Form 10-K filing, GameStop operated 3,203 stores as of February 1, including 2,325 across the United States.

The company has launched what it calls a “comprehensive store portfolio optimization review,” which is focused on evaluating which stores to keep based on market dynamics and individual performance. The 2024 fiscal year already saw 590 closures in the U.S., along with 336 in Europe, 33 in Australia, and 11 in Canada. While no specific list of future closures has been released, GameStop has stated that a “significant number” of additional stores will be closed this fiscal year.

GameStop’s recent troubles are largely tied to declining sales and changing consumer behaviors. As more gamers switch to digital downloads, the demand for physical games continues to dwindle—an evolution that has severely impacted GameStop’s traditional retail model. In the company’s own words, the growing popularity of digital content threatens to further erode physical game sales, posing ongoing risks to financial performance.

In an attempt to innovate, GameStop recently revealed it is venturing into cryptocurrency investments. On March 26, the company announced it would allocate part of its cash reserves and potentially future funding toward bitcoin. The move caused a surge in its stock price, which jumped 16% in premarket trading.

While GameStop explores new avenues to regain its footing, the retail giant faces the reality of a digital-first gaming world—one that may leave less room for storefronts and more pressure to adapt quickly.