GameStop announced this week that an additional 400 to 450 locations would close across the country by the end of 2020.
While more video games are available for digital downloads, the next generation PS5 and Xbox will contain disc drives. The company was concerned that the next generation models would be digital only.
Already in the last year, GameStop has closed 388 locations, shrinking its current retail footprint to 5,192 locations.
“This will allow us to more efficiently and profitably service our customers,” company CEO George Sherman said about the closures.
While many retailers have been shrinking their footprints as customers change their buying habits, GameStop is also encountering a change in technology in recent years, which has allowed customers to purchase games online.
But GameStop says that there are some customers who prefer a physical disc, and that large video game downloads can use up internet data.
“We believe the actions we are taking to optimize the core operations of our business by increasing efficiencies and creating a frictionless digital ecosystem to serve our customers, wherever and whenever they choose to shop, are enabling us to navigate the COVID-19 environment while positioning us well for the launch of the next generation of consoles,” Sherman said.
GameStop saw a 26.7% drop in Quarter 2 sales in 2020 compared to 2019.