GameStop stock tumbled 11% in after-hours on June 11, dropping to $25.34 on poor Q1 earnings, despite its $1.75 billion Bitcoin purchase plan.
Once Wall Street’s favourite, GameStop Corp (NYSE: GME) is witnessing massive selling pressure this week, despite doubling down on its Bitcoin buying plans. GME stock price tanked 5.27% on trading hours on June 11, and another 11% in the after-market hours, collapsing all the way to $25.34 levels.
The stock price has lost almost all of its gains, following GameStop’s Bitcoin Reserve official announcement last month. The reason behind the recent GME stock crash is the below-expected Q1 financial results reported by the firm.
GameStop (GME) Stock Crashes on Poor Q1 Results
For the first quarter of 2025, GameStop reported revenues of $732.4 million, falling short of analyst projections of $754.2 million and marking a 17% decline from $881.8 million in the same quarter last year. The Bitcoin buying company attributed the drop to persistent challenges in physical game sales.
Despite the revenue dip, GameStop achieved a net income of $44.8 million, a significant turnaround from the $32.3 million net loss recorded in the first quarter of the previous year. Operating losses also improved, narrowing to $10.8 million compared to $50.6 million in Q1 2024.
However, despite this, the GME stock has reacted negatively even as the company announced plans to raise an additional $1.75 billion for further Bitcoin purchases.
Will Bitcoin Come to the Rescue?
Following the footsteps of Strategy’s Michael Saylor, Gamestop added 4,170 Bitcoins to its treasury following a $1.5 billion fundraise through convertible note offerings back in April.
Now, the firm is willing to raise another $1.75 billion while offering convertible notes in a private placement to investors. The press release reveals that the investors are “qualified institutional buyers,” with GameStop planning an additional offering of $250 million in notes within 13 days of the initial issuance. According to the company’s disclosure, the convertible notes will carry no regular interest and are set to mature in mid-2032.
“GameStop intends to use the net proceeds from the offering for general corporate purposes, including making investments in a manner consistent with GameStop’s Investment Policy and potential acquisitions,” the press release reads.
IT seems the video game developer is doubling down on his bitcoin buying plans as corporate players rush to add BTC to their balance sheet.
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