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According to a memo obtained by gaming website Kotaku, Gamestop told its stores to remain open despite lockdowns in certain cities over the coronavirus. Gaming & Esports Consultant Rod “Slasher” Breslau joins Yahoo Finance’s Zack Guzman to discuss.
ZACK GUZMAN: I want to discuss a couple things that are going on in regards to the shut downs we're seeing play out in multiple states. Of course, California being the first move to tell its citizens to stay home, outside of all essential businesses. Now, New York following suit with Governor Andrew Cuomo issuing a similar ordinance to the citizens here in New York. And one of those companies that potentially is saying that it is essential to what's going on right now is GameStop.
That company is saying that it will keep its doors open, even though many cities and localities are moving to shut their doors and tell people to stay home because they are contributing to essential needs with gamers, and other ways to work from home like we are doing here at Yahoo Finance. And to discuss this, I want to bring on a guest who's familiar with the show he's been on before. Rod "Slasher" Breslau, a gaming and Esports consultant. And Slasher, when we're looking at this, I don't know whether or not GameStop is essential, but for right now, they say they are. What's your take on the way that they might be on the right or wrong side of this?
ROD SLASHER BRESLAU: Well, as you know, i love to come on this show and talk about how good gaming Esports is, you know, in general, for the culture. I even think there's a lot of positives right now that gaming has shown to be within-- that everybody's staying at home, and staying online, and watching streams, and playing games. And even with all of that considered, I still think GameStop are terrible, terrible people for doing this. What are they doing? No, playing video games, and buying a microphone, and going to get "Doom" at GameStop is not an essential thing that you need to do. OK, go online, buy "Doom", by "Animal Crossing", and play at home.
I cannot defend what GameStop is making their employees go to work so that GameStop, which is a failing company right now, and they try to bring in, I think, Reggie from Nintendo joined the board a little while ago. That is not going to save GameStop. Yeah, the only thing they need to do is force their employees to come into a national pandemic to go into their stores, and try to buy video games. That is pretty much the last ditch hope that they have to making this a thing. They should be totally condemned for everything they are doing right now.
ZACK GUZMAN: Well, I wanted to dig into that too, though, because we did get updates last quarter. I mean, it wasn't a good quarter. So you do wonder about the financial stresses that this company is dealing with. We saw sales drop, global sales, comparable store sales drop, 23.2% losses, amounting to about $40 million. But Ron, I mean, when we look at this too, they did say in their statement in terms of why they're staying open that they offer a wide array of products and devices that are important to facilitate remote work, distance learning, and virtual connectivity.
So not just games being offered by their store. They also instituted certain rules to make sure that not more than 10 people go into a store at a given time to protect its workers, and adhering to CDC rules. So they're trying to do this, but you do raise points there, when it does seem like all the company is wondering how much longer they can sustain business. If they do have to shut down, GameStop does seem like one of those companies that was already dealing with a lot of problems.
ROD SLASHER BRESLAU: Yeah, the way that they put it out was very cute. They would skirt the line just enough to try to make it believe that you need to go into GameStop, and these are essential needs. No, it is just to gain money. And GameStop, the PR geniuses that they are, thought that, hey, maybe making our employees coming into a global pandemic might not be very good PR in the end. Who would have thought? So no, I have no sympathy for GameStop here. This is pretty much the final straw for a lot of people. Will not be crying when they go under, probably, in the next year or two.
ZACK GUZMAN: Well, they do have about more than $200 million in cash on hand as of last quarter. They got $419 million debt load. So at least navigating there, we're seeing shares off another 9% today. And real quick, though, before we let you go. In terms of downloading games versus buying them in store, that shift has already been underway for quite some time, right. So I mean, if people did want these games, they could just download them, depending on the console they're dealing with, right?
ROD SLASHER BRESLAU: I mean, today is a huge day. You have "Animal Crossing" coming out on Nintendo, you have "Doom" coming out on all platforms, and those two games are going to be played probably for the next month while everyone is sitting indoors. And yeah, both of them you could be buying online, and you could be purchasing online, and then going to play. There is no reason to go into a store anymore. GameStop, as the function, is basically obsolete, and this is just the latest in fumbles that they've had trying to do things over time.
ZACK GUZMAN: All right, Ron "Slasher" Breslau, bringing us on the GameStop front. The latest there. Appreciate you taking the time, man.
ROD SLASHER BRESLAU: Yeah, no problem.