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Game Group shares have plunged by more than a third after the video game retailer cut its revenue forecast.

The firm said annual like-for-like revenues would now be "no better than" a 7% fall, after previously forecasting a 3% drop at worst.

"Our guidance today reflects the extraordinary economic times in which we are operating," the firm said.

Ahead of the busy Christmas trading period, Game said sales since January were down 8.6% on last year.

In morning trade, Game's shares were down 7 pence, or 37%, at 12p.

Analysts said the company's poor performance was linked to a lack of new hardware releases this year.

"Software launches have apparently been going well, but tailing off faster than historically. With no new hardware coming through and an obviously weak consumer market, we are placing our forecasts under review." said Investec Securities analyst David Jeary.

In September, Game reported a £51.5m pre-tax loss and its share price has fallen over 70% since the start of the year.

It has seen its business eroded by competition from online-only retailers such as Steam and Amazon, with Game holding on to 19% of the online market.