GameStop stock price dropped to over 8 percent on March 17 during the extended session following a surprise fourth-quarter loss as well as an announcement of launching an NFT marketplace. The loss was about $147.5 million, which means $1.94 per share. The earnings about a year ago, for the same period, were $80.3 million. The revenue in the recent quarter was $2.25 billion while it was $2.12 billion in the fourth quarter of a year ago.
GameStop is an important meme stock and its stock price skyrocketed about a year ago due to social media Reddit where a hype was created by users for the company.
Last May, the company announced it is working on an NFT platform that is based on Ethereum blockchain technology. GameStop is ambitious with the new project and wishes to become the Amazon of gaming.
The GameStock stock surprisingly gained value by about 1,500 percent in January 2021 and reached an all-time high on January 29. The value of one share was $483 then on the NYSE. The effect was due to the coordinated effort of Reddit users through r/wallstreetbets community, which is a subreddit that is dedicated to high market risk stocks. Simultaneously, Tesla CEO Elon Musk tweeted about the community and this led to a surge in the share price. It was a short squeeze.
GameStop Corp. was founded as Babbage's in 1984 by Leonard Riggio, Richard Fontaine and Daniel DeMatteo. It is headquartered in Grapevine, Texas, US.
The American video game company is the largest video game retailer in the world and is equipped with more than 4,800 stores. It has 3,192 stores in the US, 954 in Europe, 417 in Australia and New Zealand, and 253 in Canada.
The company was renamed GameStop in 1999 and witnessed a fall in performance in the 2010s due to the popularity of online video game sales and downloads. Simultaneously, it failed to make investments in smartphone retail.
Currently, the company is ranked the 521st place on the Fortune 500. It owns and publishes the video game magazine Game Informer and runs an online retro gaming marketplace named Zing Marketplace in Australia.
The successful years of GameStop were between 2004 and 20156. It acquired EB Games for $1.44 billion in 2005 and this led to its expansion in Europe, Australia, New Zealand and Canada. The next takeover was in 2007 when it bought Rhino Video Games, which operated throughout the Southeastern part of the US.