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The ‘original’ meme stock is trading up after the bell

By:
on Sep 7, 2022
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  • GameStop Corp reported narrower than expected loss for its fiscal Q2.
  • The gaming merchandise retailer announced a partnership with FTX.
  • The "original" meme stock is down nearly 50% versus the start of 2022.

GameStop Corp (NYSE: GME) jumped nearly 15% in extended trading on Wednesday after the gaming merchandise retailer reported a narrower-than-expected loss for its fiscal second quarter.

GameStop Q2 earnings snapshot

  • Lost $109 million versus the year-ago $62 million
  • Per-share loss climbed from 21 cents to 36 cents
  • Loss was 35 cents after adjusting for one-time items
  • Revenue sunk 4.0% year-on-year to $1.136 billion
  • Consensus was 42 cents loss on $1.27 billion sales
  • Ended with $734.8 million in inventory – up 23%

Other notable figures

This was the sixth consecutive quarterly loss for the video game retailer. GameStop launched an NFT platform in July but refrained from detailing its impact on the financials.

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The Grapevine-headquartered company had $909 million in cash and equivalents at the end of its Q2, as per the earnings press release.

Other notable figures in its quarterly results include hardware and accessories sales that were down 2.0% partly offset by a 26% growth in collectibles. Software sales, however, also tanked 20% year-on-year.

GameStop partners with FTX

The “original” meme stock is also up after the bell on the announced partnership with FTX that will see it selling gift cards of the crypto company at its select stores. FTX and GameStop, as per the press release, will also work together on new eCommerce initiatives.

GameStop currently has a short interest of over 17%. Wall Street has a consensus “underweight” rating on the stock with downside to $22 on average.