Shares of GameStop (NYSE: GME) rose approximately 6% on Wednesday after the video game retailer reported better-than-expected second-quarter earnings and revealed a significant bitcoin investment. The combination of strong sales in hardware and collectibles, alongside its growing exposure to digital assets, has reignited investor interest in the meme-stock favorite.
Earnings Beat and Revenue Growth
GameStop reported adjusted earnings per share of $0.25 for Q2, exceeding analysts’ expectations by $0.06. Revenue jumped 22% to $972 million, above consensus estimates. According to Reuters and Bloomberg, the results were driven by strong sales in gaming hardware and collectibles, highlighting the retailer’s continued ability to leverage both traditional and niche markets.
Hardware and accessories sales increased 31% to $592 million, while collectibles rose an impressive 63% to $228 million. However, software sales fell 27% to $152.5 million, reflecting challenges in the digital game market. Despite the software decline, the overall revenue mix suggests GameStop is successfully diversifying beyond its traditional gaming retail model.
Bitcoin Investment and Shareholder Dividend
GameStop also made headlines for purchasing 4,710 bitcoin during the quarter, valued at $528.6 million as of August 2, signaling a strategic move into digital assets. The company plans to use this investment as both a store of value and a potential growth lever.
Additionally, GameStop announced a special dividend for shareholders in the form of warrants. Investors of record on October 3 will receive one warrant for every ten shares held, with distribution expected around October 7. This move demonstrates the company’s commitment to returning value to shareholders while maintaining flexibility in capital allocation.
Market Reaction
The overall response to GameStop’s Q2 announcement was positive, with shares climbing 6% midday, despite the stock losing about 20% year-to-date. Analysts cited the combination of earnings beat, strong collectibles performance, and bitcoin exposure as key factors driving confidence in the company’s evolving strategy.
Analysts note that while GameStop faces challenges in software sales and broader market volatility, its diversification into digital assets and collectibles provides a buffer against traditional retail pressures. The company’s innovative approach appears to be resonating with both retail and institutional investors, positioning it as more than just a “meme stock” in 2025.
Looking Ahead
GameStop will aim to maintain momentum through its hardware and collectibles growth, while exploring opportunities in digital assets. Investors will be watching closely for quarterly updates on bitcoin performance, as well as the adoption of the company’s new shareholder warrants. As the company navigates the changing gaming and digital investment landscape, its ability to balance traditional revenue streams with innovative strategies will be key to sustaining investor confidence.
