GameStop, the video game industry’s largest retailer, is talking to potential buyers, the company revealed Tuesday in a press release.
While cautioning that no agreement is guaranteed, it’s the biggest acknowledgement yet that the company’s fortunes have turned as the industry it serves continues to evolve.
In fiscal 2017, GameStop reported a net loss of $105.9 million. While officials publicly continue to express optimism and point to the success of its ThinkGeek products division and game hardware sales, the company’s bread and butter, game software sales, has been losing steam for some time now.
Console makers have seen increasing adoption of their digital storefronts, which let players download and play games without having to leave their home or worry about availability. And both Microsoft and Sony now offer game streaming services, giving users access to a wide variety of titles for a low monthly cost, a model that has been extremely successful for Netflix.
That means physical products are less prevalent. And fewer physical discs means fewer used games, which has been the financial lifeblood of GameStop for many years now.
It’s not just the industry that’s changing, though. GameStop’s executive suite has been a mess for quite a while as well. Longtime CEO Paul Raines died in March after a long battle with cancer. He had temporarily stepped down from his position the previous November and resigned from the company completely in February.
The next CEO Michael Mauler lasted just a few months before resigning for “personal reasons” in May. (The company has steadfastly refused to discuss the circumstances of his departure.)
Shane Kim, who led Microsoft’s Xbox division during the bulk of the Xbox 360 era, was named interim CEO after Mauler, but many analysts expected newly promoted chief operating officer Rob Lloyd to get the top seat in the coming months.
At least one analyst blasted the company for that in a note, saying Gamestop “is in dire need of new leadership, before prior/current board members/executives run the company to ruin.”