GameStop (NYSE: GME) stock plummeted during intraday trading Friday following the release of worse-than-expected Q1 results. The video game retailer also announced plans to sell up to 75 million shares to raise capital.
GameStop surprised investors by releasing its first-quarter fiscal 2024 report ahead of schedule, with results that failed to meet analysts’ expectations. The company reported net sales of $882 million for the quarter, down from $1.24 billion in the same period last year and below the $900 million consensus estimate compiled by Visible Alpha.
GameStop reported net losses of $32.3 million, or 11 cents per share, for the quarter, marking an improvement from the previous year’s loss of $50.5 million, or 17 cents per share, but still slightly wider than analysts’ projections.
In addition, GameStop disclosed in a Securities and Exchange Commission (SEC) filing its intention to sell up to 75 million additional shares, on top of the 45 million shares it recently sold for more than $900 million.
GameStop had initially planned to report its first-quarter results after market close on June 11. The company also noted that it would not hold an earnings call following the early disclosure of results on Friday.
The unexpected earnings announcement coincided with meme-stock influencer Keith Gill’s first livestream in three years. Gill, also known as “Roaring Kitty” on YouTube and “DeepF—ingValue” on Reddit, was a prominent figure in the 2020 and 2021 meme-stock craze. His return to the spotlight has fueled increased volatility in GameStop’s stock.
During the live stream on Friday, Gill revealed his portfolio to hundreds of thousands of viewers, showing a substantial position in GameStop. His GameStop holdings, first disclosed on Reddit on Sunday, had unrealized gains of over $140 million by the time of the livestream.
GameStop (NYSE: GME) Stock Price Action
On Friday, GME stock plunged 39.38%, closing at $28.22, marking a 21.95% increase for the week. The trading volume was 276,104,432 shares, significantly higher than the average daily volume of 35.40 million.
