GME shares fall to session low after annual meeting offers no details on company strategy

GameStop shares fell to a session low Monday after the company’s highly anticipated annual meeting failed to provide any specific updates on the video game retailer’s future plans .

Meme shares fell about 12% as the company’s rescheduled shareholder event ended without detailed comments on the company’s strategy. No shareholders were asked questions during the meeting, which lasted about 30 minutes. Shares were down as much as 17% at $23.79.

In a brief introduction, CEO Ryan Cohen reiterated the company’s plan to focus on cutting costs and increasing profits, and suggested that more store closures are likely.

“Revenue without profits and future cash flow prospects have no value to shareholders,” Cohen said. This means a smaller network of stores with a wider range of higher value items that suit our trade-in model.”

Cohen did not provide further specifics on the company’s future growth strategy. He talked about the importance of having a “strong balance sheet” and called it a “strategic advantage” — especially in times of economic uncertainty. As of May 4, GameStop had about $1 billion in cash and cash equivalents on its balance sheet.

“While the future is always uncertain, the fiscal and monetary policies of the past decade both in the United States and globally have been historical anomalies. Exiting the ultra-low interest rate environment is likely to have unforeseen knock-on effects across the economy, as seen when inflation hits. 40-year high in 2022,” Cohen said.

“Given current interest rates, investments made in today’s economic climate should yield a higher return threshold,” he added. “As my father always said, actions speak louder than words. We are focused on building shareholder value over the long term. We are not here to promise or exaggerate things, we are here here to work.”

This event is interrupted by computer problems and postponed to Thursday when the server crashed due to overwhelming interest in stream.

GameStop became the center of attention again when the leader of Reddit Roaring Kitty, whose legal name is Keith Gill, stirred up another trading fever. Gill rose to fame in online trading in 2021 for touting his large positions in GameStop, both in the common stock and risky options. From return to the sceneHis position peaked at 9 million shares in GameStop after exiting the massive call option position before expiration.

The stock has risen seven of the past eight weeks after more than doubling in May. Year-to-date, it is up about 45%.

GameStop is still struggling with the shift to online gaming and away from traditional video game purchases, with investors looking to Cohen to eventually reinvigorate the company.

Nearby retailer raised more than 2 billion USD in an on-market equity sale as the video game company capitalizes on a revived meme rally. GameStop said it plans to use the funds for general corporate purposes, which may include acquisitions and investments.