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Best Buy reports catastrophic sales drop for games, yet Gamestop has best ever year. What’s going on?
Best Buy has just reported its results for the year ended 26 February 2011. Revenue was down a fraction to $16.25bn.
But the entry which caught my eye was this one, comparing sales of Entertainment Hardware and Software in the three months ended Feb 26 2011 with the corresponding period 12 months earlier (amongst analysts, this comparison is know as like-for-likes):
- Domestic: -14.9%
- International -9.9%
That’s a pretty catastrophic Christmas for video games.
Luckily it’s not entirely that bleak. GameStop also released results, showing like-for-likes up 4.8% (for the 3 months ending 29 January 2011). The growth by subcategory was:
- New video game hardware: 5.9%
- New video game software: 2.1%
- Used video game software: 3.7%
- Other: 14.4%
So Best Buy may prove to be an outlier. But for me, a collapse in video game sales of 15% for a major retail chain was quite a shock.