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GAME blames low last-gen sales for pre-Christmas slump

Shares plunge as retailer admits "challenging" conditions.

UK retailer GAME's profit forecast has been slashed after it admitted failing to match the level of pre-Christmas sales recorded last year.

GAME's share price tumbled by 34 per cent after the chain's announcement its UK revenue was down 11.4 per cent from 2014.

Over the 21 weeks leading up to 19 December, GAME's total revenue fell 6.7% to £466.8m, BBC News reported.

Christmas is the retailer's busiest season, so to see such a decline in sales is a surprise - especially when Sony's PlayStation 4 is breaking sales records. Indeed, GAME saw a 19m boost in UK sales of PS4 and Xbox One products over last year, for a total of £114.6m.

The retailer has blamed a sharper-than-expected drop off of sales for the ageing PS3 and Xbox 360, some two years after their successors hit shop shelves.

"Trading conditions in the UK video games market have been challenging," explained GAME boss Martyn Gibbs. "The switch over from the older gaming formats to PlayStation 4 and Xbox One software has impacted profitability across the UK market.

"The extent of the impact of this switch over has only become apparent in December which has been compounded by lower year-on-year High Street and shopping centre footfall."

GAME's sales since the start of the school Christmas holidays had been "disappointing", the retailer admitted.

The chain's boost in PS4 and Xbox One revenues was "more than offset by the unexpectedly steep decline in Xbox 360 and PlayStation 3 content sales", Gibbs concluded.

This year's Black Friday sales event was bigger for games in the UK than ever before, although it's not clear how many more of these sales were recorded online.

GAME has been in bigger trouble before - and fell into administration back in 2012 - but survived thanks to a dramatic restructuring which saw the closure of hundreds of UK shops.