Tuesday, February 4, 2020

GameStop downgraded by Moody's as retailer faces 'sustained competitive threats'

Retail Dive
Moody's downgraded GameStop's corporate rating to B2 from Ba2 due to “weaker than anticipated sales and operating performance, driven largely by declines in new hardware and software sales," weeks after the gaming retailer reported crushing sales declines during the holiday period. Analysts with Moody's expect sales to drag through 2020 as customers hold off on new game purchases until the next generation of consoles are released.

"Sustained competitive threats from downloadable, streaming, and subscription gaming services, as well as the company's ongoing transformation to improve profitability and evolve its vendor and partner relationships, elevate the company's business and operational risk during a period of industry weakness," Moody's Vice President Adam McLaren said in a statement. Moody's has a stable outlook for GameStop.. . . more