Shares of GameStop Corp. were down nearly 8% midday on Tuesday. The drop comes after Microsoft Corp. , which makes the Xbox gaming console introduced Xbox Game Pass, a Netflix-like service giving members unlimited access to more than 100 games for $9.99 a month. Microsoft’s new service, expected to launch this spring, threatens the cornerstone of GameStop’s business: buying and reselling video games. According to the company’s 10-K these pre-owned game sales accounted for 25% of the company’s gross profit in 2015. Shares of GameStop have fallen 20% in the last 12 months, while the S&P 500 index is up more than 21%.
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