GameStop remains popular among retail investors eager to buy the “meme stock,” but the company’s performance continues to lag.
The video game retailer said Friday it lost $32.3 million on revenue of $882 million in the first quarter due to lower sales of hardware, software and collectibles. This compares with a loss of $50.5 million on sales of $1.2 billion in the same period last year.
“While the numbers were bad (revenues down sharply year-over-year, net loss and negative free cash flow of approximately $115 million), they were broadly in line with the company’s pre-announcement on May 17,” Vital Knowledge analyst Adam Crisafulli said in a research note.
The company’s shares fell $11.83, or 25%, to $34.73 in morning trading.
GameStop shares have soared in recent weeks after Keith Gill, a popular trader who promotes his work online under the nicknames “Roaring Kitty” and “Deep F Value,” re-emerged on social media after a long hiatus. Earlier this month, Gill posted a screenshot on a Reddit forum showing he owned about $10 million. $116 million With GameStop stock.
The Return of Barking Kitty
The recent surge has boosted the company’s stock price. Thursday: 47% Gill’s YouTube channel, “Roaring Kitty,” is scheduled to go live on June 7, his first appearance on the platform in three years, which is expected to bring the stock’s closing price to $47.55.
GameStop’s shares also rose when Gill, a financial analyst-turned-influencer, surged in May. image X has hinted at a return to public life.
Before Gill’s popularity, GameStop had been experiencing declining sales amid an industry-wide shift from game cartridges to streaming and digital downloads of video games.
GameStop said it expected net sales of $5.2 billion for fiscal 2023, down from $5.9 billion the previous fiscal year. But the company managed to turn around a loss of $313.1 million in fiscal 2022 and turn it into a profit of $6.7 million in 2023.
