GameStop (GME) – Get report Shares fell sharply on Thursday after the video game retailer and favorite of meme stocks posted a lower-than-expected first-quarter loss and revealed plans to sell 5 million shares to capitalize on the meteoric that has captured the imagination of Wall Street.
GameStop also named two former Amazon (AMZN) – Get report executives – Matt Furlong and Mike Recupero – as CEO and CFO respectively, as they formalize the appointment of Chewy.com (ALL) – Get report founder Ryan Cohen as president.
However, in addition to that, GameStop revealed that it had received a request from the United States Securities and Exchange Commission last month for a “voluntary production of documents” linked to an ongoing investigation into “commercial activity” in its shares and those of other companies.
The Grapevine, Texas-based retailer posted an adjusted loss of 45 cents a share, well below the Street consensus forecast, noting that the group’s revenue increased 27.5% to $ 1.3 billion as demand for consoles offset a 5% drop in individual game sales.
The group declined to offer any short-term earnings guidance and did not answer any questions during a brief conference with analysts after the earnings, but repeated plans to sell up to 5 million shares in an “on-market” offering. noting that it will use the capital for “general corporate purposes” and investing in “growth initiatives.”
“We have helped bring stability and strength to the business, including by de-defending the presence of our stores, reducing costs and debt, and growing our company back,” said outgoing CEO George Sherman. “I also want to take this opportunity to thank our clients for their trust in us and an amazing group of shareholders who have so demonstrably demonstrated their support for us. I look forward to working with our new board of directors and leadership team in the future.”
GameStop shares fell 19.7% in midday trading Thursday to change hands at $ 243.00 each. That still leaves stocks with a staggering 1,190% gain for the year.
Data from Yolosocks.live The website, which tracks real-time mentions of actions within Reddit’s r / wallstreetbets chatroom, indicates that GameStop is the most discussed action among users, compared to a previous rank of 3, in the last 24 hours. and more than 6,765 mentions.
However, short interest in the shares remains high, with data from S3 Partners showing just over $ 3.04 billion in bets against the group, a figure that represents around 10.86 million shares, or 19.06. % of float.