GameStop Corp. tumbled as much as 36 percent to a 16-year low after posting a steeper-than-expected slide in sales and halting its dividend, signaling that the troubled retailer is out of step with accelerating trends in video games.
The latest shortfall for GameStop reflects what analysts said may be a fundamental disconnect between the company’s business model, mainly focused on sales of physical game discs at brick-and-mortar stores, and the industry’s move toward online and streaming games such as the free-to-play Fortnite.
Comparable sales — a closely watched measure of performance — fell 10.3 percent last quarter, GameStop said late Tuesday. Analysts had estimated a 6.4 percent decrease, according to Consensus Metrix. Halting the 38-cent quarterly dividend will save about $157 million annually, the company said.
GameStop’s percentage decline Wednesday was its steepest since its February 2002 initial public offering, and the stock fell as low as $4.97 in New York trading. That’s its lowest point since February 2003. The retailer has lost about 95 percent of its market value since its peak of more than $10 billion at the end of 2007, and is now worth about $520 million.
