Monday, November 29, 2021
58.7 F
Fort Worth

GameStop weighing stock offering to fund transformation

🕐 2 min read


GameStop is considering selling some of its shares, a move that would enable the video-game retailer to capitalize on the massive surge in its stock price this year.

In a filing with the Securities and Exchange Commission late Tuesday, the company noted that it has been evaluating since January whether to increase a $100 million stock offering program it established through Jeffries LLC in December.

The Grapevine, Texas, company said it has yet to sell any shares via the offering program, but is weighing doing so in order to help pay for a multiyear business transformation plan. GameStop didn’t offer any other specifics about the potential timing or size of a stock sale.

GameStop shares vaulted 1,625% in January as bands of smaller and novice investors communicating on social media hyped up the retailer’s stock in hopes of making big returns at the expense of hedge funds betting the shares would head lower. The stock was down 17% in midday trading Wednesday. It’s still up about 700% this year.

In the filing, GameStop acknowledged the stock’s “extreme” volatility this year, noting the price run up has often been “unrelated or disproportionate” to the company’s operating performance. GameStop warned investors that its shares may continue to fluctuate widely.

The SEC filing followed the release of GameStop’s fiscal fourth-quarter results, which fell short of Wall Street’s expectations. The company has been permanently closing stores and working to expand its e-commerce business as it adapts to the growing popularity of mobile gaming and video-game downloading.

Earlier this month, GameStop appointed a chief technology officer and hired executives to lead its customer care and e-commerce functions. It also named activist investor Ryan Cohen to lead the company’s efforts to drive more of its business online.

Related Articles

Our Digital Sponsors

Latest Articles

Fort Worth Business Press Logo
This advertisement will close in
Click here to continue to Fort Worth Business Press

Not ready to subscribe?

Try a few articles on us.

Enter your email address and we will give you access to three articles a month, to give us a try. You also get an opportunity to receive our newsletter with stories of the day.

This field is for validation purposes and should be left unchanged.

Get our email updates

Stay up-to-date with the issues, companies and people that matter most to business in the Fort Worth.

  • Restaurants
  • Technology
  • and more!

FWBP Morning Brief

FWBP 5@5

Weekend Newsletter

  • Banking & Finance
  • Culture
  • Real Estate