This company, GameStop, has in part chosen to park some of their corporate cash reserves into Bitcoin. This decision is made all the more surprising given the company recently announced a staggering net income of $131.3 million for their fourth quarter. The board’s vote of unanimous confidence authorized the entire implementation and engagement plan. At the beginning of business on February 1, GameStop had almost $4.8 billion in cash.
The company’s move into crypto is a sequel to a play like kind made earlier this year in the same arena by MicroStrategy. The announcement of the proposed investment sent GameStop’s stock price up 6% in Tuesday’s afterhours trading.
GameStop's decision to diversify its assets into Bitcoin reflects a growing trend among corporations to explore alternative investment opportunities in the digital asset space. As of February 1, the video game retailer had close to $4.8 billion in cash on hand.
The board's unanimous approval underscores the company's confidence in its new financial direction. Concerns investors are understandably concerned about how GameStop’s new experiment in Bitcoin will affect the company’s bottom line and competitive positioning.
GameStop’s fourth-quarter net income of $131.3 million generates a strong financial cushion for its strategic investments. The company’s stock surged 6% in Tuesday’s extended trading hours after the company unveiled its plan to invest $250 million in Bitcoin.
