Written by Stephen Nacrozes
The Wall Street Journal
Translation: Stephanie Conrad
GameStop announced Wednesday that it will be doing a 4-for-1 stock split. As a result, the video game retailer’s shares are up in post-closing trading. Trading on a retail basis will begin on July 22nd.
The US company, based in Grapevine, Texas, proposed a stock split in March. At this point, GameStop has not specified the split ratio, as it still needs shareholders to increase the number of shares allowed. Then shareholders approved the increase last month.
GameStop shareholders on record at the close of trading on July 18th will receive three additional GameStop Class A common shares for each Class A common stock. The company announced that trading will begin on July 22 on a hash rate basis.
GameStop shares rose 8.9 percent in after-hours trading on Wednesday to $127.90. The stock ended the normal trading day with a loss of 2.3 percent. Since the start of the year, the stock has lost more than 20 percent.
For months last year, GameStop has been at the center of a commercial frenzy fueled by social media. The company has restructured its executive team and board of directors to compensate for years of declining revenue and strategic missteps. The video game retailer has hired two longtime Amazon employees as CEO and CFO. Shareholders also elected activist investor Ryan Cohen as Chairman.
Under Cohen’s direction, GameStop is working on a transformation. This should be achieved, among other things, by investing in improving and expanding the e-commerce business. The company has also launched a digital wallet. According to its data, this enables transactions in the marketplace that GameStop is building for players and everyone else to buy, sell, and trade Non-fungible Tokens (NFTs).
In June, GameStop announced net revenue of $1.38 billion for the quarter ended April 30. The previous year it was still $1.28 billion.