Key Highlights

● Second-quarter net sales fell to $790.2 million from $972.2 million a year earlier.

● Operating income rose to $160.2 million from $66.4 million.

● GameStop held about 43.4 million eBay shares, valued near $4.9 billion, at quarter end.

● Management raised full-year adjusted EBITDA guidance to more than $650 million.

GameStop Corp. (NYSE:GME), whose Class A common stock trades on the New York Stock Exchange, reported second-quarter fiscal 2026 results on September 8, 2026 for the 13 weeks ended August 1. Net sales were $790.2 million, down from $972.2 million, which the company attributed to the prior-year Nintendo Switch 2 launch, planned store closures and the divestiture of its French business. Operating income nonetheless rose to $160.2 million from $66.4 million, described by the company as its highest second-quarter operating income.

The mix shifted markedly. Collectibles sales rose 57% to $356.3 million and now represent 45.1% of sales, while video games fell to $263.2 million from $494.6 million and pre-owned and refurbished products to $170.7 million from $250.0 million. Gross margin widened to 43.7% from 29.1%, and selling, general and administrative expense fell to $187.1 million from $218.8 million.

Where the net income came from

Net income was $298.7 million, or $0.51 per diluted share, against $168.6 million. Not all of it is operational. The company recorded a $166.3 million gain on a derivative asset and a $72.1 million unrealized gain on its equity investment, partly offset by a $75.0 million loss on digital assets and related receivables. Income tax expense was $121.5 million versus $6.0 million. Adjusted net income was $161.1 million, or $0.27 per diluted share, and adjusted EBITDA was $174.0 million.

For the full year to January 30, 2027, management raised its adjusted EBITDA guidance to more than $650 million, from more than $600 million given on June 26, 2026. That is a company projection, and first-half adjusted EBITDA of $339.7 million is the reported base.

The eBay position and the balance sheet

The most unusual feature is GameStop's stake in eBay (NASDAQ:EBAY). According to the second-quarter release, it held about 43.4 million eBay shares with a fair value near $4.9 billion at quarter end, after converting its derivative exposure into direct holdings. On May 3, 2026 it sent eBay's board a non-binding proposal at $125 per share in cash and GameStop stock; press reports state that eBay's board rejected it, and no definitive agreement has been announced. Stockholders approved a larger share authorization on July 7, 2026, with 68.7% of votes cast in favor, giving capacity for stock-funded transactions.

Cash, marketable securities, digital assets and related receivables totaled $5.4 billion at August 1, compared with cash of $8.7 billion a year earlier, a decline consistent with $4.4 billion paid for eBay shares in the first half. On September 3, 2026, privately negotiated exchanges retired about $1.4 billion of convertible note principal, leaving long-term debt of roughly $2.8 billion. No share repurchases were reported, although a $2.0 billion authorization was approved on June 2, 2026.

eBay Proposal Uncertainty and Warrant Dilution

GameStop is a constituent of the S&P MidCap 400.

The company's own risk statements highlight the cyclicality of video games, dependence on trading cards and pop culture for collectibles, concentration of investments in few holdings, bitcoin and stablecoin exposure, debt service, dilution from warrants issued on October 7, 2025, share price volatility, reliance on chief executive Ryan Cohen, and the uncertainty around the eBay proposal. A bid that never proceeds, or one that does, would each bring different financial consequences.