GameStop Approves Bitcoin Investment Plan Amidst Earnings Report on March 25

GameStop (GME) announced on March 25 that its board unanimously approved a plan to invest in Bitcoin and US dollar-denominated stablecoins, utilizing corporate cash or future debt issuances. This decision follows a February 8 social media post from CEO Ryan Cohen with MicroStrategy (MSTR) CEO Michael Saylor, sparking speculation about cryptocurrency investments. As of February 1, GameStop's cash reserves stood at $4.77 billion, a significant increase from $921.7 million the previous year. The company's fourth-quarter earnings report, also released on March 25, revealed net sales of $1.28 billion for the quarter and $3.823 billion for fiscal 2024. However, adjusted EBITDA for the full year was $36.1 million, down from $64.7 million the year prior. Wedbush analyst Michael Pachter suggests that GameStop's stock might not necessarily benefit from this strategy, referencing MicroStrategy's valuation relative to its Bitcoin holdings.