clock menu more-arrow no yes mobile

Filed under:

GameStop may not compete effectively as browser, mobile and social gaming becomes more popular, says retail chain

Retail chain GameStop commented on the ever evolving state of games distribution, stating it may not be able to compete effectively in the face of browser, mobile and social gaming.

According to a recent SEC filing from the company, the rising popularity of these genres will likely negatively affect GameStop's financial position if the company fails to respond.

"Gaming continues to evolve rapidly," reads the statement. "The popularity of browser, mobile and social gaming has increased greatly and this popularity is expected to continue to grow. Browser, mobile and social gaming is accessed through hardware other than the consoles and traditional hand-held video game devices we currently sell.

"If we are unable to respond to this growth in popularity of browser, mobile and social games and transition our business to take advantage of these new forms of gaming, our financial position and results of operations could suffer. The Company has been and is currently pursuing various strategies to integrate these new forms of gaming into the Company's business model, but we can provide no assurances that these strategies will be successful or profitable."

GameStop states the retail chain has experienced a decline in sales as a result of a reduced number of new software titles available for sale. According to the filing, the company depends on "the timely delivery of products," while delays and limited numbers of platforms and software can reduce sales in one or more fiscal quarters. In addition, the chain depends on third parties to develop products, including new platforms, accessories, PC hardware and software.

"Our business could suffer and has declined due to the failure of manufacturers to develop new or enhanced video game platforms, a decline in the continued technological development and use of multimedia PCs, or the failure of software publishers to develop popular game and entertainment titles for current or future generation video game systems or PC hardware."

According to the chain, Sony, Activision, Nintendo, Microsoft and Electronic Arts make up 17 percent, 16 percent, 14 percent, 13 percent and 11 percent of new product purchases in the fiscal year of 2012.

Sign up for the newsletter Sign up for Patch Notes

A weekly roundup of the best things from Polygon