GameStop announced its board of directors has unanimously approved a plan to purchase bitcoin using the company's corporate cash reserves. This move, similar to MicroStrategy's well-known bitcoin investment strategy, comes as investors celebrate GameStop's positive fourth-quarter results. The announcement triggered a rapid spike in the company’s stock. It surged over 6% in after-hours trading, though the increase was extremely shaky.
GameStop is looking to add bitcoin and other cryptocurrencies to its balance sheet. This decision continues a trend as noted by CNBC in early February. In its fourth quarter of fiscal year 2022, GameStop reported a net loss of $131.3 million. That’s a big jump from the $63.1 million raised during the same time last year.
GameStop has even begun to diversify into bitcoin. They’re taking a page out of the book of MicroStrategy, which has invested billions into bitcoin in recent years. MicroStrategy’s pivot has truly changed the game, moving it from a software growth stock into a bitcoin holding company.
Investors initially responded wildly favorably to GameStop’s announcement. The increase in the company's stock price reflects investor confidence in the company's new strategic direction.
