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GameStop makes $55.5B takeover offer for eBay

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Re: GameStop makes $55.5B takeover offer for eBay

#591

Post by Legend2440 »

ball_of_lint wrote: post #547
Legend2440 wrote: post #381

Earlier quoted context omitted.

Keep in mind, this is not because they turned the business around and made tons of money. Sales are lower now than in 2020. Investors gave them this money; they sold additional stock to raise $3.47B in 2024, and another $4.2B of convertible debt in 2025.

They have not made a ton of money yet, but they have turned the business around in a significant way. Where GameStop lost money every quarter from 2019 to 2023, it has now had 8 profitable quarters in a row. The fact that investors are giving GameStop money is a good thing for GameStop; It is a signal of confidence. It is not a detriment like you try to position it.

They also just closed another 470 stores this year. Sales are half of what they were in 2019.

Basically they got a huge cash infusion from memestock hodlers trying to get to the moon. Greater than half of their profits are now from the interest on that money, which is wild.

However, the retail business itself is still failing because no one buys video games at the mall anymore.

Re: GameStop makes $55.5B takeover offer for eBay

#592

Post by potsandpans »

Forgeties79 wrote: post #586
potsandpans wrote: post #583

Earlier quoted context omitted.

I have to imagine that this performance was intentional and this guy is not just out of his mind. Just find it difficult to imagine anything outside of market manipulation: either an eBay pump and dump scheme, or collusion to get investors to sell as the inflation comes down so activists can pick up more.

I did some digging today and learned that he currently takes no salary and stands to make an unbelievable amount of money if he hits certain (pretty unreasonable apparently) benchmarks. I think it was $35 billion . My very armchair guess here is that he’s just trying something incredibly loud, brazen, and ambitious because at this point what else can you do? They’ve been falling apart for years, the business has not…

Could be. But he has to secure board approval for doing something like this. So he apparently was able to convince the GameStop bod that this is a reasonable play.

One has to wonder if there's an unstated interested party ready to back the deal.

Re: GameStop makes $55.5B takeover offer for eBay

#593

Post by CSMastermind »

pragma_x wrote: post #585
giancarlostoro wrote: post #240

The original shorting of GameStop back in 2021 gave them a bit of a boost back into the green. While people were doing the GME to the moon, GameStop made more shares to sell, and paid off a bit of its debts, I think it made about a billion dollars in profit, they're still struggling, but it helped prolong their life. A friend of mine also pointed out and this made it click for me that it makes 100% sense, GameStop is…

> Imagine being able to list your eBay items locally without having to have people needing to come to your house, or better yet, getting a cut of what you wanted up front since they're basically a pawn shop, and then they list it on eBay and turn a bit of a profit with a local pickup option available. I kind of assumed there were already local businesses that already did this? Seems like a decent side-line for any dr…

There used to be back during the original eBay boom but I haven't seen any in a while.

Re: GameStop makes $55.5B takeover offer for eBay

#594

Post by bombcar »

dawnerd wrote: post #557
CamperBob2 wrote: post #528

Earlier quoted context omitted.

Yes, consignment stores have existed for a long time, but they aren't generally functional interfaces to eBay. If you want your stuff to sit on a shelf for the next few years, a consignment store is OK, I suppose. When I sell something, I usually want the item gone ASAP in exchange for a modest amount of money.

There’s a ton of eBay sellers doing consignment, usually for friends that just want to sell things but I’ve seen some much larger operations selling pallets worth of goods from stores not large enough to wholesale or liquidate.

Yep, watching the store/usernames of sellers can be instructive (many thrift stores, pawn shops, consignment stores, and others list things on eBay, especially for fixed price).

One of the reasons to refund an order is “already sold in-person”.

Re: GameStop makes $55.5B takeover offer for eBay

#595

Post by sanswork »

trollbridge wrote: post #571
sanswork wrote: post #533

Earlier quoted context omitted.

>A fraction of that profit does come from interest income. More than half of it came from interest income. Gamestop has been unable to grow revenue since Cohen took over, failed initiative after failed initiative. The only thing saving them is their meme stock nature and a legion of people willing to throw good money after bad allowing them to dilute shareholders to build a warchest. They have increased profit by clo…

Not growing revenue yet being profitable seems far preferable to growing revenue yet having bigger and bigger net losses. Shareholders seem to agree, as the stock went from formerly around $2.50 to present day about $92 (accounting for splits), dispute the dilution.

Tightening your belt is a good thing. No disagreement there but it has a hard limit. You can't just keep tightening the belt and growing profit, at some point you have to start revenue expansion again and from what I've seen Gamestop has no way to do that.

At $2.50 they had massive amounts of debt they couldn't service and a very real chance of going out of business. Then through pure luck they became a meme and were able to extract $10b from investors so of course they are worth more today. There is no growth story though so as meme investors get bored and move on it will move back down to it's asset value unless they find a way to grow again.

Re: GameStop makes $55.5B takeover offer for eBay

#596

Post by 59percentmore »

arcticbull wrote: post #549
turtlesdown11 wrote: post #516

Earlier quoted context omitted.

Total revenue has declined for several years, -27% in 2024, -11% in 2023 (2023 rev was $5.9b, to $3.6b in 2025, this is a shrinking business).

They haven't had a genuinely good year in the last 15 years. Their TTM revenue is down 66% from what it was in 2012. In nominal dollars. In real dollars it's down 75%. https://www.macrotrends.net/stocks/charts/GME/gamestop/reven...

And yet...

https://tradingeconomics.com/gme:us:eps

(Macrotrends has it, too.)

What's more important, revenue or profit?

Re: GameStop makes $55.5B takeover offer for eBay

#597

Post by TheGRS »

spaqin wrote: post #338
dgellow wrote: post #258

Earlier quoted context omitted.

I thought the point of eBay was to get rid of that middleman. Wouldn’t that be something eBay would have done at some point if they wanted to own a pawnshop? Not saying that cannot work but that doesn’t sound like a genius idea

Over time, eBay has become the middleman - with international shipping centres, basically escrow service with buyer protection, and rather high fees for promotion and of course, the actual sale. No middleman is something like Craigslist or FB Marketplace.

I interviewed at a place that had their own collectible card market, I think they partnered with eBay. But the whole service was that you would yield your valuable cards over to them and they would store them in a repurposed bank vault for safe keeping or to act as a seller. Cards that were like $1k or more.

They seemed to be doing really well esp with all the pokemon and MTG card crazes going on.

Re: GameStop makes $55.5B takeover offer for eBay

#598

Post by orlp »

ball_of_lint wrote: post #532
orlp wrote: post #13

Earlier quoted context omitted.

Yes, that goes into the '50% cash' part of the offer. With a 20B credit line and 7.5B cash from their own coffers (which they claim to have, so let's believe them on their word there), you cover the cash portion. The issue is the non-cash portion of the offer. They claim that the remaining 27.5B is covered by GameStop stock. But that's more than double the market cap of GameStop.

> which they claim to have, so let's believe them on their word there So you're just outright accusing GameStop of fraud? https://www.sec.gov/ix?doc=/Archives/edgar/data/1326380/0001... page 36 of their filing with the SEC lists the cash and marketable equities. The non-cash (stock) portion of the offer needs to be valued against the resulting entity, which will own eBay. This will likely result in current eBay share…

> So you're just outright accusing GameStop of fraud?

I have no idea why you interpret my words that way. I just meant that I didn't want to analyze the cash portion of their offer any further and just wanted to take it at face value.

Re: GameStop makes $55.5B takeover offer for eBay

#599

Post by shaftway »

crazygringo wrote: post #575
shaftway wrote: post #564

Earlier quoted context omitted.

You're right that there's no real advantage to eBay buying a pawnshop conglomerate, but a pawnshop conglomerate buying eBay gets a massive advantage. They're already sitting on a mountain of used inventory, and at some point a lot of it will be thrown away because there are no local buyers for it. Having a commission-free way to offload that inventory would be huge for them.

Ebay commissions are not that high, 13.25% for most items. The barrier to listing huge amounts of merchandise is not the commission, but rather the amount of labor it takes to list and price everything and pack and ship it and deal with refunds and returns for items that turn out to have problems. And how a lot of items are only economical to sell locally, because when you add in shipping costs it approaches the valu…

> Ebay commissions are not that high, 13.25% for most items.

13.25% isn't zero.

> The barrier to listing [is] the amount of labor it takes to list and price everything

GameStop has a surprising amount of technology around their pawnshop activities. My son traded in his laptop last month and they had him wipe it, enable developer mode, and plug it in to do automated tests and make sure they knew what they were getting. They're already doing the labor to price everything. They're not going to have people type up listings, they'll just automate posting off of their inventory system.

> when you add in shipping costs it approaches the value of buying something new.

They get to skip the shipping costs. You could choose to have them ship the item to a GameStop near you which would cost them pennies. This is an advantage of having stores in every city with a population over 50,000 in the US.

And a huge amount of the stuff that GameStop buys and sells is out of print. Buying new is simply not an option when you're talking about a game that was released 6 years ago only on physical media.

> The way inventory is offloaded in bulk is in bulk pallets sold at auction, where people bid on them and then do all of the grunt work involved in photographing and listing and packing and shipping.

There must be money in the margins here. Otherwise people wouldn't do it. GameStop has all the technological ability to cut out this grunt work.

Re: GameStop makes $55.5B takeover offer for eBay

#600

Post by TheGRS »

turtlesdown11 wrote: post #518
iinnPP wrote: post #511

Earlier quoted context omitted.

It's reasonable to predict that as physical media is phased out by the likes of Sony, Microsoft, and Nintendo, that the value of offline capable inventory will shift to an investment instead of a liability. Increasing their percent cut as a result.

Their margin was highest on used physical media, which continues to plummet. Physical sales are down from $13b in 2015 to $1.5b in 2025, while total sales of physical + digital went from $23.5b in 2015 to $60b in 2025. Physical media is a tiny fraction of current game sales, even if their margin skyrockets, they're stuck in a tiny kid pool of potential sales.

Not to be harsh on people who like this stuff, but reminds me of whenever people bring up how big vinyl record sales are now. Which is like, yea they're "big" just because it was a tiny market for the last decade and they're profiting mostly on nostalgia. Vinyl's not making some huge comeback, but it will probably sustain some niche resellers for a long time.
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