​Axios learns of mass layoffs of blockchain specialists from GameStop

What’s new? Video game retailer GameStop has begun laying off blockchain specialists en masse, Axios reports, citing employees and information on the business social network LinkedIn. GameStop’s cryptocurrency wallet, which was launched in May 2022, has reportedly been adversely affected. At the same time, the company also reported a decrease in sales and cash. According to CNBC, the drop in revenue is due to the company’s entry into the digital space.

Information on the Axios website

What is known about GameStop? It is an American retail chain selling video game consoles, computer games, and accessories, founded in 2000. As of January 30, 2021, the chain had 4816 sales outlets worldwide. The company became widely known after the value of its shares rose 50 times from $7 to $350 in late 2021, thanks to a flash mob by users of the entertainment website Reddit, who began buying up the securities en masse. Subsequently, they were joined by investment funds. Prior to that, the share price had been falling for six years in a row, as the business of selling games on discs was losing relevance.

Details on the state of the company. According to a report for the US Securities and Exchange Commission (SEC) for the third quarter of 2022, the firm posted a net loss of $94,7 million, down by 10% from the same period in 2021. Meanwhile, sales declined from $1,3 billion to $1,2 billion. GameStop’s cash and cash equivalents fell to nearly $804 million from about $1,4 billion a year earlier. However, the company’s shares, traded on the New York Stock Exchange (NYSE) under the ticker symbol GME, rose by 11,37% to $24,79 on December 9, according to Investing.com.

GameStop’s report to the SEC

What is going on with GameStop? According to DappRadar, the daily revenue for GameStop, an NFT marketplace launched in July 2022, fell below $4000 on August 22. At the time of the project’s launch, NFT sale revenue was about $44,500.

In September, just two months before FTX went bankrupt, GameStop announced a partnership with the exchange to develop Web 3.0 products. FTX gift cards were also available to GameStop customers. After the partnership ended due to the exchange’s collapse, the retailer pledged to reimburse affected customers. GameStop CEO Matthew Furlong said the platform’s collapse did not have a significant impact on the company but did not provide further updates.

The company is working to become profitable and rebuild its retail business after, according to executives, it has not received enough investment for many years. In recent months, the company has changed leadership and has been focused on initiatives to consolidate in the digital world, CNBC writes.

On December 7, Furlong said at a meeting with investors that the company “is attempting to accomplish something unprecedented in retail … seeking to transform a legacy business once on the brink of bankruptcy.” He added that the company is working to strengthen its balance sheet to consider buying additional businesses and is continuing to cut costs, including through layoffs.