The company continues to face the temporary headwind of lower current-generation console hardware and software sales as consumers delay purchases in anticipation of new platform launches expected later in the year. The Covid-19 outbreak has led to changes in how consumers work, play and learn and over the past few weeks, led to increased demand for its products.
The company exit the year 2019 with about $500 million in cash despite a challenging sales environment. GameStop significantly improved its capital structure and optimized its operations by improving inventory.
GameStop is closely monitoring the dynamic situation around Covid-19 and potential impacts on its business. Despite increased demand since the outbreak began as millions of consumers look to GameStop for products that support remote and virtual work and learn settings, given the uncertainty around the evolving situation, the company has suspended further guidance at this time.
The company began fiscal 2020 with increased financial flexibility and continued focus on key priorities to optimize, stabilize and transform GameStop to achieve sustainable profitable long-term growth.
The company continues to focus on maintaining its balance sheet strength, prioritizing the allocation of resources to areas of the business that produce strong cash flow, reducing expenses across the business and intensifying inventory discipline.