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What happened

Shares of GameStop (NYSE:GME) fell 12.8% in October 2016, according to data from S&P Global Market Intelligence. It was a long, slow dive without dramatic plunges, as investors continued to weigh the true value of a bricks-and-mortar game retailer in an increasingly digital gaming era.

So what

In many ways, October simply continued the crushing downward momentum of GameStop's recent trading history. In August, a disappointing second-quarter report set the lazy avalanche in motion with a quick 11% single-day drop. Nothing has changed since then, except that the desperate nature of GameStop's situation kept sinking in.

GME Chart

GME data by YCharts.

Now what

And the slide didn't stop there. GameStop's November started with another 12.5% crash as the company released a weak slate of preliminary third-quarter results. Comparable-store sales are plunging as much as 7% lower, as October's list of new game titles failed to inspire a customer rush. Both revenue and earnings projections took a large hit, and GameStop keeps moving closer to the edge of irrelevance.

The stock is down 53% over the last year at this point. Short of giving up on the physical-retail strategy and becoming an all-digital game distribution hub, I don't know what GameStop's management could do about this terrifying trend.

GameStop has burned about $2.5 billion of market value over the last 52 weeks. Don't catch the falling knife, because there's still plenty of value left to destroy. Next up, GameStop will report third-quarter results on Nov. 22. Frankly, I expect another horror show.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.