GameStop Q2 2026 preliminary results: sales down, profit up
GameStop posted preliminary second-quarter results on Monday showing net income between $290 million and $310 million, up from $168.6 million in the same period a year ago, even as net sales fell to a range of $780 million to $800 million from $972.2 million.
The retailer said net income for the quarter reflects approximately $238 million in net gains from its eBay derivative asset and equity investment, with that figure partially reduced by around $75 million in losses on digital assets and related receivables. Operating income is expected to land between $150 million and $170 million, compared with $66.4 million in the prior-year quarter.
Sales declined for several reasons, the company said, including the prior-year launch of Nintendo Switch 2, planned store closures, and the divestiture of its France operations. GameStop said it expects to release complete second-quarter results on September 8.
During the quarter, the company converted a previously disclosed derivative position related to eBay into a direct equity investment. As of August 1, GameStop held roughly 43.4 million shares of eBay common stock with a fair value of approximately $4.947 billion. Cash, cash equivalents and marketable securities are expected to be in the range of $5.05 billion to $5.07 billion, down from $8.69 billion at the close of the prior year's second quarter, reflecting the conversion.
GameStop also announced Monday that it is amending a previously disclosed plan to exchange approximately $1.4 billion in convertible notes for Class A common stock. Under the revised terms, noteholders will receive roughly 55.5 million shares of common stock, about 73% of the consideration, and approximately $358.4 million in cash, or about 27%, which GameStop said it expects to fund from cash on hand. The exchange is now expected to close on or about September 3. GameStop stock rose 5% in premarket trading on Monday, after the amended structure limited the dilution shareholders would face from new share issuances.
The original exchange agreement, announced earlier this month , was structured to be settled entirely in stock, with the number of shares determined by the average volume-weighted price of GameStop stock over a 35-day reference period. The amendment terminates the remainder of that reference period, fixing the total number of shares to be issued.
GameStop has been building a stake in eBay as part of a broader takeover pursuit. In the first quarter, GameStop CEO Ryan Cohen put forward a non-binding proposal to acquire all of eBay's outstanding shares at $125 apiece, split between cash and stock. eBay's board rejected the offer, calling it "neither credible nor attractive." Following the exchange closing, approximately $1.1 billion of 2030 convertible notes and $1.7 billion of 2032 convertible notes will remain outstanding, the company said.
