GameStop’s earnings Report: A Focus on Bitcoin Amid Declining Sales
GameStop’s stock price will be closely watched this week. The company is set to release its first earnings report since it began purchasing Bitcoin.
GameStop’s stock closed the week at $29.58, down 16% from its peak this year. the company’s market cap stands at over $13 billion.
Analysts predict that GameStop’s core business will continue to struggle as more gamers shift to online platforms. Revenue is expected to be $754 million, a 14.47% drop from the same period last year. For the second quarter, the guidance is $748 million, down 6.28% year-over-year.
These figures reflect a trend of declining sales. GameStop’s annual revenue has fallen from $6 billion in 2022 to $3.8 billion last year. Analysts believe the company’s conventional business model may become obsolete as the gaming industry evolves.
To adapt,GameStop is following in the footsteps of Strategy,a company with a $100 billion valuation due to its Bitcoin holdings. GameStop now holds 4,710 BTC coins, valued at over $497 million. The company plans to buy more Bitcoin, thanks to its strong financial position. It has over $4.7 billion in cash and no debt, giving it the adaptability to invest in Bitcoin.
GameStop’s market cap is over $13 billion. Its equity valuation also allows it to sell shares to fund Bitcoin purchases.
GameStop’s bitcoin holdings represent 3.76% of its market cap, compared to Strategy’s 58%. The company’s stock price has retreated since it started its Bitcoin strategy, moving from $35 in May to $29.58.
The daily chart shows the GME share price is inside an ascending channel.It remains above the 50-day and 100-day moving averages, a bullish sign. the outlook is neutral ahead of its first quarter fiscal 2025 results, set for June 10.
Key levels to watch include the psychological point at $20 and the resistance at $35.78.
