GameStop Used Game Sales Pegged for $2b

GameStop Used Game Sales Pegged for $2b

GameStop’s used games business alone will rake in $2 billion this fiscal year, or 23 percent of total revenue, one analyst estimates.

The number is compared to $1.6 billion, or 22.4 percent a year ago. The retailer’s fiscal year ends January 31.

An article in The Wall Street Journal said around 42 percent of GameStop’s overall gross profits stem from its used games business, a figure that Evan Wilson with Pacific Crest called "astronomical," as most retailers turn only single-digit margins.

GameStop’s gross profit margin for used games is nearly 50 percent, versus around 20 percent for a new game sale.

Some publishers have expressed concern over the used games business, as they don’t see a penny from the countless used game transactions that take place every day.

WSJ noted Epic Games’ move to include a code for free downloadable maps in new copies of Gears of War 2, a practice that adds a bit more incentive for consumers to splurge that extra $5-$10 for a new copy.