GRAPEVINE, Texas (AP) — GameStop’s seesawing stock price surged 7% late Tuesday after the video game retailer disclosed plans to invest some of its cash in cryptocurrency.
Without providing any details, GameStop said its board of directors had approved a revision in its investment policy to enable the Grapevine, Texas, company to convert some of its U.S. dollars into Bitcoin, which has become a hot commodity since last November’s election of President Donald Trump. His election led to the departure of regulators who had cracked down on alleged fraud in the cryptocurrency market. As of early February, GameStop held nearly $4.8 billion in cash.
After GameStop signaled it would start betting on Bitcoin, the company’s famously volatile shares rose $1.83 to $27.83 in extended trading. Even if the stock behaves similarly in Wednesday’s regular trading session, the price remains far below its 52-week high of $64.83. That was reached last May shortly after influential investor Keith Gill, popularly known as “Roaring Kitty,’ appeared online for the first time in three years to declare his support for GameStop.
Gill’s cheerleading revived memories of a “meme stock” craze he helped ignite in early 2021, when GameStop’s stock price soared above $120. The company had suffered cumulative losses totaling more than $1.3 billion during the previous three years while its sales eroded. GameStop earned $131 million on sales of $3.8 billion during its more recent fiscal year.