GameStop Q1 2025 earnings preview:
Bitcoin investment adds new dimension to transformation story

The backdrop

GameStop is scheduled to report its first quarter (Q1) fiscal 2025 earnings after the market closes on Wednesday, 11 June 2025 at 6.30am (AEST).

GameStop's previous quarter earnings results exceeded expectations:

• Earnings per share: return to profitability vs. prior year loss
• Revenue: $881.8 million in Q1 2024, down from previous highs

CEO Ryan Cohen said: "We're transforming GameStop into a technology company focused on gaming, collectibles and blockchain. Our Bitcoin investment represents a strategic move to diversify our treasury and capture the potential of digital assets."

Despite operational improvements, GameStop shares have experienced volatility, with the stock down approximately 5% year to date. While GameStop has shown progress in cost reduction, investors remain cautious about the sustainability of its transformation amid challenges in physical retail gaming.

Key numbers to look for in Q1 2025

• Revenue: expected to decline approximately 14.5% year-over-year to around $754.2 million from $881.8 million in Q1 2024, reflecting ongoing challenges in physical game sales
• Earnings per share (EPS): consensus estimates suggest $0.04, a significant improvement from a loss of $0.12 per share in the prior year's Q1, representing a notable turnaround
• Cash position: analysts expect cash and equivalents to increase to approximately $5.95 billion from $4.775 billion, bolstered by the $1.3 billion convertible notes offering in March
• Bitcoin holdings: mark-to-market impact of 4,710 Bitcoins (valued at over $515.7 million at purchase) will create new earnings volatility based on cryptocurrency price movements
• International operations: updates on store closures and exit costs from Italy, Germany, and planned French operations sale

Factors shaping investor reactions

Close attention will be paid to the following factors which will shape investors reactions following the earnings report:

Bitcoin investment strategy and performance

The Bitcoin purchase, announced on 28 May 2025, is a focal point. Investors will scrutinise the mark-to-market impact on quarterly earnings and management's commentary on future cryptocurrency investments.

The correlation between GameStop's share price and Bitcoin movements has fundamentally changed the investment thesis, introducing cryptocurrency volatility as a significant factor in stock performance.

Operational restructuring and cost management

GameStop's exit from European markets and domestic store optimisation will be critical. The company has been streamlining its international presence to focus resources on more profitable markets.

Store closures and international divestitures will likely result in one-time charges, though they should contribute to improved operational efficiency over time.

Digital transformation progress

Updates on GameStop's shift toward digital gaming, NFT marketplace, and technology initiatives will be closely watched. The company continues to navigate the challenging transition from physical to digital gaming.

Convertible notes and capital allocation

The $1.3 billion convertible notes offering has strengthened GameStop's balance sheet while creating potential future dilution risks for shareholders. The effectiveness of capital deployment will be crucial for maintaining investor confidence.

Is GameStop a buy or a sell?

GameStop has a TipRanks Smart Score of '4 Neutral' and is rated as a 'Sell' with 0 'Buy', 0 'Hold' and 1 'Sell' recommendation (as of 2 June 2025).

What does the options market say?

GameStop shares are currently down around 5% year to date, last at approximately $30, after experiencing significant volatility throughout 2025. Ahead of this week's earnings report, the options market is pricing in elevated volatility, indicative of potential significant moves in either direction.

The introduction of Bitcoin exposure has added a new layer of complexity to GameStop's trading patterns, as the stock now mirrors cryptocurrency movements more closely than traditional retail metrics.

However, while GameStop has historically experienced outsized moves around earnings reports, the actual movement in the company's share price can vary significantly from options market implications.

GameStop TipRanks smart score chart

GameStop technical analysis

GameStop's share price has experienced considerable volatility over the past few weeks, having briefly overcome but not managed to remain above its $34.37 December peak in May 2025.

The stock has become more correlated with Bitcoin price movements since announcing its cryptocurrency investment, creating new technical dynamics for traditional chart patterns.

Looking forward, the April-to-June uptrend line at $29.19 shapes as important support. A sustained break below this level could see the stock re-integrate the $28.00-to-$25.67 mid-April-to-mid-May sideways trading range.

​GameStop candlestick chart

The early May low at $25.67 and the 200-day moving average at $25.51 provide important downside support on a daily chart closing basis. A drop below the $25.50 mark would likely lead to the April low at $20.73 being revisited.

On the upside, initial resistance is viewed at the May peak of $35.81. A sustained break above this level would be needed for a medium-term bullish reversal, potentially targeting the June 2024 high at $48.00.

While no rise above the May peak at $35.81 ensues, the GameStop share price is more likely to slide again rather than see another upsurge in the near future.

GameStop daily chart