Analyst: GameStop to triple sales by 2014
Baird Equity says no Battlefield 3 for Steam, but GameStop's Impulse to host
A report from financial analyst firm Baird Equity Research has claimed that GameStop expects to see it's sales revenues triple in the next three years, based on the projected total of $500 million for 2011.
After a meeting with the retailer's management, lead technology analyst Colin Sebastian issued a report which claims that the board of GameStop, which now includes Shane Kim, expects a sales volume revenue of $1.5 billion by 2014, largely reliant on an increased focus on the company's digital strategy.
New strategies on second hand retail are also believed to be key to the company's future.
Part of that digital strategy has been the acquisition of Impulse, a PC-download service and rival to Valve's Steam.
GameStop executives are quoted as expecting Impulse to cannibalise Steam in the report, predicting that the retailer will take "a meaningful share from market leader Steam" via Impulse.
One significant coup in that process is the apparent securing of EA's Battlefield 3 for the service, likely to be a good seller on PC. That game has long been rumoured to not be coming to Steam after the public disagreement between EA and Valve over EA's new Origin download service.
Following the announcement of Origin, several of EA's games are no longer available via Steam, including Crytek developed Crysis 2.
"The upcoming EA title Battlefield 3 will be sold as a download through GameStop, but not through Steam," reads Sebastian's report. "Given Steam's dominance - and insistence on users downloading a Steam client application - publishers are likely to be receptive to a competitive alternative."
Whilst a prediction of tripling sales over three years may seem ambitious, GameStop's most recent financial figures do indicate that the company's digital business is growing strongly. The retailer's figures for the nine week period ending January 1, 2011 showed a 100 per cent increase in digital sales, as well as a 5.4 growth in total sales and record figures overall.
Despite that strong quarter, share prices for GameStop fell by over 4 per cent in the following days as investors called the figures "disappointing."