GAME shares plunge following sales decline
Stock falls almost 14% in the first hour of trading as supermarkets tighten their grip
Following the news this morning that sales at GAME had fallen by 14 per cent year-on-year in the 18 weeks to December 5 - despite the world's biggest entertainment release occurring with Modern Warfare 2 in November - shares in the UK retailer have fallen sharply.
It's stock price was down by 14 per cent an hour after trading opened, before rallying slightly to stand at 13 per cent down at the time of writing.
Among the reasons given for the sales decline by chairman Peter Lewis was the impact of extremely aggressive price-slashing by supermarkets - Tesco and ASDA specifically - which both sold key titles including MW2 and FIFA 10 at less than 50 per cent of the SRP.
That move was described by Don McCabe - MD of independent retailer Chips - as "destructive pricing" which could seriously harm the specialist retail landscape.
"It's no longer just a situation of looking at a title, working out how good it is, working out what market it is, and then buying a quantity for your customer base," he told GamesIndustry.biz in October. "Now you've got to think, who's going to trash the market, and if they trash the market what effect is it going to have on my stock holding?"
GAME's share price was 126.10 pence at the time of writing, down 12.79 per cent (or 18.50 pence) since opening this morning.