It’s not quite made it to the moon just yet, but GameStop (NASDAQ: GME) is showing investors that it plans to turn things around.
Aside from its meme-stock status, its fundamentals as a business are improving according to its Q1 earnings.
GME to the moon?
For Q1, GameStop reported that its net loss narrowed to $66.8 million, or $1.01 per share, from a loss of $165.7 million, or $2.57 per share, a year earlier.
What’s more, its actual business of selling games and merchandise is improving, with revenue growing to $1.28 billion from $1.02 billion a year earlier. And Q2 appears to be going well too, with leadership letting investors know that total sales for May actually rose 27% year-over-year too.
Despite declining to provide guidance for the year, which has sent shares down in after-hours trading, the company is also officially free of all long-term debts as of May 1.
And the ace up its sleeve? The video game retailer said it had tapped Amazon executive Matt Furlong as its new CEO — an all-star addition to a business seeking to rehabilitate its image and become a dominant e-commerce leader.
What investors should be taking away from all of this is the company’s refusal to simply be a ‘meme’ stock. Not only is it actively tackling business problems — poor leadership, failing business model, rising debt — but it’s keeping investors in the loop about all of these goings-on.
Unlike its meme-stock brethren, AMC — which is offering shareholders free popcorn to appeal to the young retail investor demographic — GameStop could well be on its way to successfully pivoting towards a collectibles and games e-commerce model, leaving its bricks-and-mortar past behind. Sure, it’s a long way off just yet, and I wouldn’t personally invest at these overinflated prices, but I can’t deny that my interest has been piqued.
MyWallSt operates a full disclosure policy. MyWallSt staff currently holds long positions in companies mentioned above. Read our full disclosure policy here.
Editor at MyWallSt
Jamie is the Content Editor here at MyWallSt. His favorite stock is Apple, which is also the first stock he ever bought. Jamie is not only a big fan of its products, but he believes that the tech giant has a whole lot more to give the world, and hasn't even scraped the surface of its potential.