Guitar Center has never been profitable. I beileve an article I read many years ago, they have been in debt since they went public.
This isn't a surprise. I say it's simply part of the process. The slow death of R&R which was occurring by the late 70's, and interest in general, certainly changed music and listener tastes.
What teenage kid by the 90's was listening to 70's and earlier guitar-centric music, and got inspired to spend time in the "woodshed?"(does anyone even know that means anymore?)
R&R was diluted by the mid 70's and "spectacle" was holding the attention of the masses just as much as the music.
There still seems to be up and coming Classical and Jazz musicians. I'm listening to the NPR Classical station and every Sunday is the program, "From the Top," It's young classical musicians performing . The program usually includes an amazing Classical guitarist, of course playing..an acoustic guitar.