Summary
HMV has had a very difficult time and now they have issued out their third profit warning in four months. Analysts had forecast HMV’s profit to be £80million, but in reality profits have only been £30million. Chief executive Simon Fox is in talks about selling the Waterstone’s book store chain, also owned by HMV. Analysts believe that HMV will have to close down many stores in the UK due to the disappointing sales. The chain is currently renegotiating its bank loans, which they hope will have the music store chain more breathing space in order to get its finances in order.
Reaction
I personally think that it is a shame that HMV is doing so poorly. HMV is one of the only big record store chains left in the UK and if they were to go bankrupt, it would be one step closer to the demise of music sales through a physical platform. People have gotten more and more used to buying music off the internet and if HMV were to go belly up, it might mean — apart from the independent record stores — that internet will be the only real option people will have to buy music, DVDs or otherwise.
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