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GameStop’s stock took another hit on Wednesday as investors reacted disappointingly to the company’s quarterly figures, which showed little progress in both revenue and profit. Additionally, the value of the bitcoin it purchased earlier this year has declined.
Bitcoin Purchase Proves Unfavorable So Far #
GameStop invested in bitcoin in May, allocating over €467 million to the digital currency. At the time, it was seen as a notable but bold move, similar to what MicroStrategy did years earlier. However, since that purchase, the company’s stock has fallen by nearly thirty percent.
According to the latest quarterly report, the value of the bitcoin holdings decreased by approximately €8.4 million last quarter. Nevertheless, the company is still up by about €17.8 million in total, as the purchase price was lower than the current market value. GameStop also emphasized that it did not buy or sell any bitcoin in the third quarter.
Bitcoin’s Value Declines #
The decline in the treasury’s value is due to a sharp correction in bitcoin itself. The cryptocurrency has lost about nineteen percent over the past three months. During this period, CoinGlass reported the largest liquidation wave ever, with positions worth approximately $17.5 billion wiped out in a single day.
Other companies with large bitcoin positions also suffered. MicroStrategy, which holds about €70 billion in bitcoin, saw its shares fall sharply during the same period. Founder Michael Saylor even admitted that the company might have to sell its bitcoin to meet financial obligations, despite his earlier statement: ‘Never sell your Bitcoin.’
GameStop Does Not Rule Out Selling Bitcoin #
GameStop indicated that it might sell its bitcoin position if it becomes part of ’treasury management operations.’ This warning had appeared in previous reports but is now receiving more attention due to market turmoil.
While the bitcoin purchase dominates the news, GameStop’s core business is also under pressure. Quarterly revenue fell by 4.5 percent, from approximately €822 million to €755 million. For the first nine months, revenue remained nearly flat, from about €2.34 billion to €2.32 billion.