Yesterday, GameStop revealed that its quarterly sales significantly declined, and its overall losses widened due to spending and an overabundant inventory.
However, in the wake of the massive financial losses, the video game retailer also revealed a new partnership with crypto exchange FTX. As a result, shares of the company rose over 6% in premarket trading this morning.
The move is part of an overall initiative to modernize the brick and mortar retailer within today’s digital landscape. You may recall in January when GameStop announced it would enter the NFT marketplace. Well, in July the company opened it up to the public for beta testing and allow users to connect their own digital asset wallets to buy, sell and trade NFTs for virtual goods.
The new partnership with FTX aims to further expand GameStop’s digital initiatives. In a press release, GameStop highlighted its goals work alongside the crypto exchange both online and in physical store locations.
In addition to collaborating with FTX on new ecommerce and online marketing initiatives, GameStop will begin carrying FTX gift cards in select stores.GameStop
GameStop continues to face damaging losses
However, even as the company furthers its modernization campaign, current outlooks for the company overall remain dim. At the end of this year’s second fiscal quarter, its sales revenue dropped from $1.18 billion to $1.14 billion. Even more startling is its overall losses widened to $108.7 million following its previous $61.6 million in the previous year.
One unique factor that sets GameStop apart from other companies is its on-and-off surges in relation to its meme stock label. However, even with the occasional surges that certainly help pull the company out of water time to time, GameStop has major work to do if it truly wants to compete and stay relevant in today’s online world.
What do you think about GameStop’s efforts to digitize its financial model? Do you think the company will succeed or is the approach in working with NFTs actually contributing to its downfall? As always, let us know what you think in the comments!