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GameStop CEO Says Video Game Software Makes Up Less Than 12% Of The Business
GameStop chief executive Ryan Cohen has said video game software now accounts for less than 12% of the retailer’s business, arguing that the shift towards digital-only games would therefore have little effect on its plans. His comments underline GameStop’s increasing reliance on collectibles rather than its traditional games retailing business, particularly as physical game releases face an uncertain future.
Cohen said collectibles represent more than half of GameStop’s business, with Pokémon trading cards and action figures reportedly helping it achieve record first-quarter profits. He made the remarks while discussing GameStop’s rejected $56 billion bid for eBay, maintaining that the company still intends to pursue an acquisition, though he would not say whether it would increase its offer.
In short
- GameStop says software is now under 12% of its business.
- Collectibles make up more than half of sales.
- Cohen says GameStop still wants to acquire eBay.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
GameStop's strategic pivot towards collectibles represents a pragmatic adaptation to irreversible market forces. With digital gaming becoming dominant, the company cannot reverse this trend through physical game sales, so repositioning around collectibles—which now exceed 50% of revenue and have driven record profits—demonstrates clear-eyed business management. Reducing dependence on a shrinking segment is rational, and this diversification positions the company for longer-term sustainability in a transformed market.
The case against
Whilst acknowledging digital trends, critics contend that GameStop is abandoning its core competency in games retailing without securing a defensible position in collectibles. The company now competes directly with established players like eBay and Amazon in collectibles, where it lacks competitive advantage. The failed $56 billion eBay acquisition bid and the company's difficulty completing major acquisitions suggest the pivot may be more aspirational than substantive, raising questions about whether this strategy can deliver genuine profitability or represents strategic drift.
Explained simply
GameStop is a retailer that built its business selling physical video games and gaming hardware. The company has struggled as more gamers buy games digitally rather than on disc, eroding its traditional market.
Chief executive Ryan Cohen has responded by shifting GameStop's focus towards collectibles such as trading cards and action figures. The company now derives the majority of its revenue from these products rather than from games themselves.
The shift reflects a broader transformation in the gaming industry as digital distribution becomes standard. For GameStop, adapting away from physical game sales has become essential to its long-term survival in a changing market.
Americas Business Companies Entertainment Gaming Software Technology