GameStop closes 590 stores with more shutdowns ahead as revenue drops $39.3M
In fiscal 2024, GameStop closed 590 stores nationwide and has warned of additional closures in its 2025 fiscal year ending January 2026, while Q2 revenue fell $39.3 million year-over-year. CEO Ryan Cohen received performance-based stock options requiring GameStop’s market capitalization to reach $100 billion to vest, compared with its current $9 billion level.
1. Store Closures Accelerate Retail Footprint Contraction
GameStop announced the closure of 590 stores in its fiscal 2024 year and has signaled plans for a substantial number of additional shutdowns as its fiscal 2025 year concludes in January 2026. Unofficial tracking sites and social media posts have verified shuttered locations across multiple states, underscoring the company’s retreat from underperforming mall and shopping-center venues. These moves reduce fixed costs but also shrink physical exposure in markets where digital downloads and e-commerce have eroded in-store traffic.
2. Revenue and Profit Trends Point to Continued Pressure
In its December earnings report, GameStop reported a year-over-year revenue decline of $39.3 million, extending a multi-year slide driven by competition from online retailers and the shift to digital game distribution. Trailing-12-month EBITDA stood at $222 million, reflecting modest profitability but requiring significant growth to support ambitious long-term value targets. Investor attention will focus on whether the company can reverse revenue attrition while leveraging its existing cash flows.
3. Revised Investment Policy Enables Digital Asset Entry
Early in 2025, GameStop amended its investment policy to permit allocation of excess liquidity into cryptocurrencies, most notably Bitcoin. The stated objective is to optimize investment returns within defined risk parameters while preserving sufficient funds for day-to-day obligations. This strategic pivot signals management’s willingness to diversify beyond core gaming retail, though it introduces new volatility considerations for shareholders accustomed to traditional brick-and-mortar metrics.
4. CEO Compensation Tied to Aggressive Growth Milestones
In January, GameStop awarded CEO Ryan Cohen a performance-based stock option package contingent on achieving cumulative EBITDA of up to $10 billion and a market capitalization of $100 billion over a multi-year horizon. Initial vesting occurs at a $20 billion market cap and $2 billion EBITDA threshold, representing nearly double current levels. Successive tranches unlock at escalating targets, with full realization requiring an elevenfold increase in market value. This all-or-nothing structure aligns executive incentives with transformative growth but places substantial execution risk on management.