GameStop had massive success last year, which has got people asking if is GameStop a Fortune 500. Nobody thought that GameStop, a company that ruled the 1980’s malls, would be making headlines and captivating wall street in recent years.
But something fascinating happened and changed the narrative for GameStop, which was going the same way as Blockbuster.
This made GameStop’s share price shoot forcing investors to buy its shares, which drove its prices even higher.
This article has all the essential information about GameStop, including the answer to the question,
Is GameStop a Fortune 500?
Yes, GameStop is a Fortune 500 company headquartered in Grapevine, Texas. GameStop was founded in 1984 in Dallas and got its current name in 1999.
It’s one of the largest video game retailers in the world and operates 4,573 stores. Of the stores, 3018 are in the USA, 907 in Europe, 417 in Canada, etc.
Additional Information
A Fortune 500 company is a private or public US company. For a company to be considered a Fortune 500, it has to be in the top 500 in gross revenue.
In simpler terms Fortune 500 is the list of the 500 best money-making companies in the USA and the world.
What Is GameStop?
It’s the world’s largest and most successful video games retailer, operating approximately 4573 stores in the USA, Australia, Canada, Europe, and New Zealand.
As mentioned, the company was founded in 1984 and has undergone several acquisitions and mergers.
Barnes and Noble first acquired it in 1999. They sold off GameStop’s controlling stake in 2004, but it continued buying smaller companies to expand its global footprint.
The GameStop Business Model
For years GameStop has been competing with companies like Blockbuster Video and Tower Records, which have since gone down. To avoid the fate of such companies, GameStop had to develop a great business model, which involved pivoting online.
The first step towards adopting a new and profitable business model was bringing Chewy founder Ryan Cohen onto its board. After this, GameStop established its eCommerce, which increased its sales by up to 25%.
The company also closed 12% of its brick-and-mortar stores to reduce costs. In addition to all its efforts to increase sales and profits, GameStop has no long-term debts, making it a great company to invest in.
Today its portfolio is valued at approximately $85-$100 million. This can allow it to use a business model similar to that of Target, i.e., offering fast delivery and in-store pickup for their goods.
How Does GameStop Company Make Money?
The company makes most of its profits from selling used games as it has the power to control the margin and spread.
Recently, Microsoft and Sony released new consoles, which helped push GameStop sales up by approximately 25%.
However, some online gaming services such as Steam and Xbox Live offer gamers entire game libraries online.
These games are easily downloadable from any place, and the services continue to become popular. Overall, this represents a massive challenge for GameStop.
GameStop is continually expanding its licensed merchandise. For example, it studies the most popular comic-con products and devotes a part of its funds and stores to these products.
In addition, in 2015, GameStop bought ThinkGeek, which already had several licenses, improving its market share.
Before 2020 it had acquired Kongregate, which allowed it to enter social gaming. In 2013, it acquired Spring Mobile, which gave it a share of the wireless market. Lastly, in 2013, GameStop got Simply Mac, enabling them to sell Apple Products.
The GameStop Company also made a bold move by appointing to ex-Amazon executives Mike Recupero and Matt Furlong to help transform it into a thriving e-commerce company.
How Changes in Market Conditions Affect GameStop
In this era, there has been massive technological advancement. The introduction of downloadable games by services like Steam, Nintendo eShop, PlayStation Network, Xbox Live, and more has affected physical games.
The market for physical games is facing a decline, and this is something that’s affecting GameStop.
At first, GameStop tried to work out this issue by enforcing each of its employees to the Circle of Life program.
This program ensured that every employee allowed a certain percentage of their sales to reward cards, used games, preorders, etc.
However, this program wasn’t great as it had employees lying to customers. It also led to emotional distress and poor working conditions.
Later that period, GameStop decided to reform the program to focus entirely on the store and not on individual employees.
Recently, GameStop has invested in eCommerce to remain competitive. A strong online store and presence is the only thing that could keep GameStop afloat.
GameStop brought in employees with great experience in eCommerce. The good news is that it immediately started paying off, and sales increased.
Is GameStop a Great Company To Invest In?
Despite its recent wins and good management, some experts believe GameStop stocks aren’t a good investment yet.
But if you want to invest in GameStop, it is best to wait until its share prices go down to a more reasonable level.
Gamestop will be a great buy, considering the efforts it has put in place to improve its digital presence.
Furthermore, it has a strong leadership that brings eCommerce experience to the company. It surely has the potential to be an eCommerce gaming powerhouse.
What Are The Best Companies To Invest In 2023 – Alternatives To GameStop
Recession fears, high-interest rates, and rising inflation dominated 2022. The tech stocks experienced a fall, and the energy sector was the best investment option until the sudden start of the Russia-Ukraine war. This war hugely disrupted the global prices of energy.
However, 2023 is still fresh, which means a new chance to invest in stock and make money. Here are the 6 best companies you should check out in 2023.
PayPal Holdings
PayPal is a well-run company that has stood the test of time. In 2022, PayPal stock took a hit. This was due to the loss of their great relationship with eBay Inc. and a weaker macro environment.
However, PayPal has recently announced a deal with Apple Pay which might see them making profits.
Apple Pay has accepted to use of PayPal and will accept any Venmo-branded cards. Using Venmo-branded cards will expand, offering PayPal more exposure to brick-and-mortar retail.
In addition, Amazon now accepts PayPal, which exposes it to its large marketplace.
Apple Inc.
It is the biggest publicly traded company in the entire world. But, like other tech companies, it had a rough 2022 because of high interest and recession fears that made potential investors back off.
But all this brought the Apple stock price to a great point, and investors can now make a sound entry.
Apple stocks will always be a great buy as long as they continue producing incredible devices. Plus, people love Apple Products because of how they seamlessly integrate.
Citigroup Inc.
Citigroup is a multination bank that has investments in both retail and banking. There are many reasons why Citigroup is a great place to invest. First, it offers great dividends at 4.4%, which is nice in this rising era of inflation.
Additionally, the dividends are very sustainable since the company uses less than 30% to finance its dividends payouts.
Some popular investors that own Citigroup shares include Warren Buffet; he began investing in the shares in 2022 with his company, Berkshire Hathaway Inc.
Amazon.com Inc.
The dominant online retailer Amazon is still an attractive option in 2023. In 2022 the company had a hit in stocks by inflation, supply chain challenges, a tight labor market, etc.
However, some of the services that have kept it afloat include Amazon Web Services. This AWS brings in a huge revenue of approximately $84 billion and is still growing.
Walt Disney
The one thing you need to consider when buying and holding company stocks is the company’s long-term management team. Walt Disney recently hired back its long-term CEO, Bob Iger, which is a plus.
Iger was responsible for a series of Disney successes, including acquiring Marvel Entertainment, Pixar, Lucasfilm, and more. His return to Walt Disney means more success for the company.
Diageo PLC
This is a popular UK-based beverage company valued at approximately $100. The Diageo stocks are a great buy since alcohol prices tend to be so resistant to recession.
Like tobacco users, alcohol consumers are known to have great brand loyalty. This company has amazing brands such as Guinness, Johnnie Walker, Baileys, Smirnoff, Cîroc, and many more.
Conclusion
The answer to is GameStop a Fortune 500, is an absolute yes. In the past years, GameStop, just like Blockbuster, struggled to stay profitable. This is because it was using the old business model.
But with the change of management and adoption of a new business model, the company saw an increase in sales and profits. In return, the company got more investors, and its share price rose. Today, it’s among the best companies to invest in as it’s still coming up with great ideas to increase its sales.
