Photo: Tony Sprackett on Flickr
Toys ‘R’ Us may have missed its opportunity to go public.Video game sales have tanked ever since kids have told their parents they prefer iPhones and iPads, according to Stephanie Clifford and Peter Lattman at the New York Times.
The company announced it was going public way back in May 2010, but the IPO was repeatedly delayed as management waited it out for a better time.
Now, there is concern that the time has passed. According to Cliiford and Lattman:
“A major challenge has been a sharp reversal in video game sales. Once an area of growth, thanks to Nintendo Wii and other consoles, they have fallen as children move to iPhone games and apps for iPads. Last year, about 8 per cent of Toys “R” Us’s business was in video game sales, down from 11 per cent in 2009.”
And this year is especially important for the company and CEO Jerry Storch:
“This is a very crucial year for Jerry Storch and Toys “R” Us — there have been expectations for them going public, and it hasn’t happened yet,” said Jim Silver, editor of TimetoPlayMag.com and an influential toy industry expert. “They need to come back.”
During the 2011 holiday season, many shoppers opted to go to Amazon, which offers cheaper products, and Walmart, which offered layaway.
Last month, Moody’s put a negative watch on the company’s debt.
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