GameStop’s stock price saw a notable 7% surge Tuesday after the video game retailer revealed to invest some of its cash reserves in cryptocurrency.
The company, based in Grapevine, Texas, disclosed that its board of directors had approved a change in its investment policy, allowing it to convert a portion of its U.S. dollar holdings into Bitcoin. The move comes as Bitcoin continues to gain popularity, particularly following the election of President Donald Trump in November, which resulted in a shift in regulatory oversight over cryptocurrency markets. As of early February, GameStop held nearly $4.8 billion in cash.
The announcement led to a rise in GameStop’s stock price, with shares increasing by $1.83 to $27.83 in after-hours trading. However, even with this boost, the stock remains well below its 52-week high of $64.83, reached last May. This peak followed a rally sparked by Keith Gill, also known as “Roaring Kitty,” whose public support for the company reignited the “meme stock” frenzy.
Gill’s online endorsement brought back memories of early 2021, when GameStop’s stock soared above $120, despite the company’s significant financial struggles. In the three years prior, GameStop reported losses exceeding $1.3 billion, while sales continued to decline. The company posted a profit of $131 million on $3.8 billion in sales during its most recent fiscal year.
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