GameStop said on Tuesday that its shares are – and remain – “extremely volatile”.
In addition, this volatility is “due to a number of circumstances beyond our control.”
The statement in a regulatory document is the first statement by GameStop’s leadership about the ongoing stock price fiasco, which saw its shares rise by up to 1,600% in a matter of weeks.
In the “risk factors” section of the annual report, the volatility of the company’s shares is listed as the main risk factor related to the company’s shares. He specifically cites “short squeezes” as the main reason for this volatility.
“The market price of our Class A common shares has been extremely volatile and may continue to be due to a number of circumstances beyond our control,” said GameStop in the process.
A 12-month chart of GameStop’s stock price shows the meteoric increases and catastrophic declines of the past few months.
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GameStop’s stock price has been explosively unpredictable since mid-January.
Between January 15 and 27, the price jumped from about $ 35 to just $ 350. He saw equally huge drops, but months later it is still in the $ 180 range.
The reason, of course, is the much-discussed “short tightening” of a large group of individual investors raising the company’s stock price in an effort to defeat short sellers who bet against the shares. This has been a big topic of discussion in recent months for many people in the media and on Wall Street – except for the GameStop leadership.
The company was more or less silent for weeks and even refused to discuss the matter in its quarterly earnings conference call last week. Instead, the company’s leadership focused on the ongoing “transformation” of the company led by co-founder Chewy and former CEO Ryan Cohen.
Since Cohen joined the company in January, taking over as a “strategic” committee soon after, the company has made a series of high-profile hires, such as Amazon and Chewy.
It is unclear what Cohen’s specific plans are for the company’s future, but he broadly outlined the plans in an open letter to the company’s board in late 2020.
GameStop “needs to evolve into a technology company that delights players and offers exceptional digital experiences,” Cohen wrote in the letter, “not to remain a video game retailer that prioritizes its physical presence and stumbles into the online ecosystem.”
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