Gamestop Could Be Going to $0. Buy This Stock Instead.
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GameStop is fading fast, but the trend killing it also has a clear winner. Here's where to put your money instead.Remember the skyrocketing meme stocks of 2021? Gosh, how time flies. It has been almost five years since social media posts ignited short squeezes in GameStop (GME 2.04%) and AMC Entertainment Holdings (AMC 2.20%) shares. From the closing bell on Jan. 20, 2021, to the end of Jan. 27, 2021 (just one week later), AMC's stock spiked 570% higher while GameStop soared 788%. But the joy didn't last long. AMC's stock is down 98% from that peak, and GameStop has lost 73% as of Dec. 17, 2025. The average analyst recommendation for GameStop is underperform with a price target 41% below the current level. Keep those expected price drops up for a few more years, and there won't be much left. I hate to say it, but GameStop is starting to look obsolete. When was the last time you bought a video game from a local store instead of just downloading it to your favorite console? GameStop's stock may very well go to zero in the long run. Image source: Getty Images. Amazon is eating GameStop's lunch On the upside, I can recommend one of GameStop's top competitors for new money in 2026. The same digital industry shift that's destroying GameStop has big winners too. In particular, Amazon (AMZN +2.46%) benefits in several ways from the game-download trend.Advertisement Amazon Luna: The e-commerce giant has its own cloud-based gaming service -- no discs, no downloads, just run the games on Amazon's servers and stream the experience to your favorite web browser or mobile device. Prime Gaming: Amazon Prime subscribers have free access to many Luna games and in-game items. Digital game sales: Amazon sells download codes for Sony PlayStation, Microsoft Xbox, Nintendo Switch, and PC games. You get the same product as GameStop's, with no retail footprint needed. It's true that each gaming platform also offers direct downloads, but Amazon helps you organize your gaming buys across many device types. AWS gaming infrastructure: Amazon Web Services (AWS) powers online multiplayer, game streaming, and patch/update delivery for many major publishers. This way, Amazon profits whether you play on PlayStation, Xbox, or PC. Twitch: Amazon owns the dominant game-streaming video platform. Twitch also integrates with Prime Gaming for cross-promotion. E-commerce for hardware: And Amazon is happy to serve if you're looking for consoles, controllers, or accessories (the physical stuff GameStop's brick-and-mortar stores rely on). Gaming is just a bonus; Amazon is a great buy anyway And here's the best part. With or without its gaming industry muscle, Amazon stock is a fantastic buy right now. Amazon's annualized revenue growth has averaged 11.5% over the last three years, with 13% year-over-year jumps in the last two reports. The company generated $10.6 billion of free cash flow over the last year, based on a massive $691 billion in top-line revenues and $120 billion of capital expenses. Those artificial intelligence (AI) data centers won't just build themselves, you know. This trillion-dollar tech titan is earning its market cap the honest way, with excellent financials and strong growth prospects. Sorry, GameStop, but Amazon is the first place I'd start looking for a buy related to the video game industry.Read NextDec 18, 2025 •By James Brumley3 Warren Buffett Stocks to Hold ForeverDec 18, 2025 •By Prosper Junior Bakiny2 Unstoppable Stocks to Buy No Matter What Happens in 2026Dec 17, 2025 •By Adria Cimino2 Monster Stocks to Hold for the Next 10 YearsDec 16, 2025 •By Geoffrey SeilerGot $1,000? 3 Stocks to Buy Now While They're On SaleDec 16, 2025 •By Keith SpeightsThe Best Warren Buffett Stocks to Buy With $1,000 Right NowDec 16, 2025 •By Neil PatelCould Amazon Help You Become a Millionaire?About the AuthorAnders Bylund is a contributing Motley Fool media and technology analyst covering semiconductors, cloud computing, internet infrastructure, quantum computing, and streaming media. Previously, Anders was a systems administrator for Nielsen Technology and CSX, gaining hands-on experience with enterprise-class systems. He was also a freelance writer for Ars Technica, TIME, USA Today, CNN, WIRED, and AOL's Daily Finance. He holds a bachelor’s degree in English and a master’s degree in library and information sciences from Florida State University. He believes in coyotes and time as an abstract.TMFZahrimX@TMFZahrimStocks MentionedAmazonNASDAQ: AMZN$226.72 (+0.02%) $+5.45GameStopNYSE: GME$22.56 (0.02%) $0.47AMC EntertainmentNYSE: AMC$1.78 (0.02%) $0.04*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.Advertisement