Good news or not, GameStop is forever etched into investing history with the terms ‘WallStreetBets’ and ‘retail investors’ coming in at close second. Still fresh in our minds or not, GameStop currently looks to be on the (partially) good-news bandwagon as its earnings release on Wednesday showed a 21% annual increase for its Q2 2021 net sales, reaching $1.2b. The company’s revenue increase comes under a new strategy to shift its business towards e-commerce and online orders — its recent leasing of a new 530k sqft fulfillment center being one of the many concrete steps in that direction.
Despite the strong revenues, though, the earnings are a mixed bag — the firm is still making a net loss. Although the loss did annually drop by almost 44% to $61.6m, the firm’s new strategy might take some time to kick in. As that happens, future earnings could begin to show a further decrease in net loss.
why it matters
During the WallStreetBets fiasco, ‘detached from fundamentals’ was often used as an excuse for why the stock’s rising price was unjustified. But its latest earnings show some return to those previously-missing fundamentals. As a result, GameStop’s share price was up by 0.3% yesterday, despite an initial 10.5% drop earlier in the day.