Operating loss of $35 M (compared with operating loss of $312 M in FY22)

Small but notable net earnings of $6.7 M (compared with net loss of $313 M in FY22)

How did GameStop make $50 million in interest income?

GameStop was profitable for the first time in 6 years

GameStop reported full-year profitability for fiscal year 2023, contradicting the prevailing media sentiment that GameStop is a terrible company destined for bankruptcy

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Summary

• On March 26, 2024, GameStop released financial results for the fourth quarter and fiscal year ended February 3, 2024, demonstrating small but not insignificant full-year profits for the first time in 6 years, despite reduced revenues. "Net income was $6.7 million for fiscal year 2023, compared to a net loss of $313.1 million for fiscal year 2022."
• Sentiment of GameStop found in financial media continues to be negative, dishonest, and cynical, despite the undeniable but often ignored improvements to the fundamentals of the company that have been achieved by the new management team. In most cases, the fact that GameStop was profitable for the first time in 6 years is not even mentioned at all.

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Historical context

From a historical point of view, GameStop was consistently profitable every fiscal year from 2005 through 2016, with the exception of 2012. Starting in fiscal year 2017, GameStop began showing reduced profitability, and from FY 2018 through FY 2022, was unprofitable.

Source: GameStop 10-K filings - Google Sheets

Looking exclusively at revenue, it is clear that there has been a significant reduction starting approximately with fiscal year 2019. Much of this can be attributed to the fact that gamers are increasingly buying games digitally rather than in the form of physical discs such as can be purchased at a brick-and-mortar retail store like GameStop.

Yet, even in fiscal years 2017 and 2018, it is clear that despite high revenues the company was not performing well.

Heading through 2020, GameStop was undeniably a struggling company facing significant challenges, and according to many was destined for bankruptcy. The trading price of GME reflected this prevailing sentiment, and the financial media was dutifully critical.

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Company turnaround

In 2020, activist investor Ryan Cohen began purchasing shares of GME, ultimately becoming the largest individual owner of the company with approximately 12% ownership. By June 2021, the entire board of directors of the company was replaced by Ryan Cohen and his associates, with Ryan Cohen becoming chairman of the board. From this time onward, control of the company was completely in the hands of this new leadership team.

"We inherited a bunch of legacy everything, and under-investment across the entire business –- people, the entire technology stack, just decades of neglect, and so it’s hard to turn around a brick and mortar retailer that’s under the kind of pressure that GameStop was and continues to be under, but that was also part of the attraction going into GameStop was that a transformation the likes of GameStop was really unprecedented and I was motivated by that."

• Ryan Cohen, November 2022

The company went from a situation where it was losing hundreds of millions of dollars per year to net profitability in fiscal year 2023.

While this is an undeniably positive result for the company in this time period, GameStop continues to face numerous challenges and must continue to improve and adapt in order to successfully compete in the modern video game industry.

---

Media sentiment

What does mainstream financial media have to say about GameStop achieving full-year profitability for the first time in 6 years?

• GameStop faces 'unsustainable' sales decline, cuts jobs to control costs

  • Focuses on job cuts, reduced revenue, leans on the opinion of Michael Pachter
  • Fails to mention GameStop achieving full-year profitability

• GameStop Q4 Earnings Highlights: Retail Favorite Stock Plunges After Revenue, EPS Miss

  • Emphasis on GME share price going down
  • Focuses on reduced revenue
  • Did mention some favorable facts
  • Fails to mention GameStop achieving full-year profitability

• GameStop Stock Plummets Following Q4: Profitability Fails to Offset Significant Revenue Miss

  • Headline emphasizes GME share price is down
  • Makes clear that GameStop achieved full-year profitability for the first time in years
  • Generally fair reporting of other facts

• GameStop Stock Plunges After Earnings Fall Short of Expectations—Key Level to Watch

  • Headline emphasizes GME share price is down, 'expectations' were missed
  • Focus on job cuts, reduced revenue
  • Fails to mention GameStop achieving full-year profitability

• Jim Cramer Says GameStop Is Arguably The Worst Company In America

  • Article is entirely negative, leans on the opinions of Jim Cramer and Michael Pachter
  • Fails to mention GameStop achieving full-year profitability

• GameStop Q4 Earnings Smash Wall Street Expectations: Reports Profitability For First Time In Over Half A Decade

  • Makes clear and emphasizes contextual significance of GameStop's full-year profitability
  • Generally positive about GameStop's financial circumstances

• GameStop could be gone in less than 5 years, says analyst

  • Article is almost entirely negative, leans on the opinions of Michael Pachter
  • Does mention GameStop's positive cash holdings of $1.2 billion
  • Claims that Reddit's WallStreetBets has 'seemingly walked away from the “stonk”', fails to mention that GME discussion is censored on WallStreetBets (formally banned by the moderators in 2022), fails to mention that GME shareholders are found in different online communities
  • Fails to mention GameStop achieving full-year profitability

• GameStop Needs To Get Its Game Back

  • Focuses on reduced revenue, job cuts
  • Weak mention of GameStop posting a full-year profit of $6.7 million
  • Generally fair assessment of the struggles faced by GameStop

• GameStop Confirms More Layoffs, Share Price Tumbles After Sales Slide

  • Headline emphasizes job cuts, GME share price is down
  • Generally neutral article
  • Does mention GameStop's full-year profitability

• A Sales Slump Is the Kiss of Death for GameStop Stock

  • Entirely negative article, leans on the opinion of Michael Pachter
  • Fails to mention GameStop achieving full-year profitability
  • 'If you value your wealth, just stay away from GameStop stock.'

• GameStop saga ends. Winner: capital markets

  • Entirely negative article, leans on the opinion of Michael Pachter
  • Focuses on GME share price being down
  • Fails to mention GameStop achieving full-year profitability
  • 'In this case, “shorts” were right... The meme army may have lost, but perhaps next time will be clearer-eyed.'

• GameStop Stock: Is This The End of a Saga Or Just Another Chapter?

  • Despite any sentiment implied by the headline, this article provides a mostly neutral assessment of GameStop's circumstances
  • Mentions GameStop achieving full-year profitability

Searching for recent news about GameStop yields mostly negative sentiment that fails to even mention at all that GameStop achieved full-year profitability for the first time in 6 years.

Failing to mention this important detail is a deliberate decision that reveals a clear bias in the media. It goes beyond just reporting about true negative facts about GameStop. It demonstrates a deliberate effort, by those culpable writers and media outlets, to propagate a specific sentiment about the company that is not allowed to even mention contextually important true positive facts about the company.

GameStop was profitable for the first time in 6 years - this is the news headline that captures the significance of GameStop's recent earnings report. Yet, an unassuming person who consumes mainstream financial media likely would not even learn about this important fact at all.

Who would benefit from that?

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Ongoing financial conflict

Why are there competing, mutually exclusive narratives?

There are competing narratives because there are competing financial interests.

One of the listed news articles, GameStop saga ends. Winner: capital markets, from Reuters, draws some attention to this ongoing conflict while declaring that the conflict is actually over and one side has won and one side has lost.

GME shareholders that believe in the company turnaround and leadership, despite the real challenges faced by GameStop, have a vested financial interest in the success of the company, with a desire for the share price of GME to go up, and naturally will promote the narrative that supports this financial interest.

In opposition to GME shareholders are all of the financial market participants that have a vested financial interest in the share price of GME going down. An example of such a participant would be any hedge fund that has a net short position on GME. The article refers to this faction as "shorts", recogonizing that such a faction with an interest does exist. Naturally, members of this faction will promote the narrative that supports their financial interest.

If the prospect of GameStop's success was not an ongoing threat to one faction of incumbent market participants, then there would be no reason to deliberately omit the fact of GameStop's profitability, to pretend that it isn't something that even happened at all.

Recognizing that there is an ongoing financial competition between factions that stand to benefit financially from a particular outcome of the GME share price, which faction benefits when most mainstream financial media articles propagate negative sentiment about GameStop and deliberately ignore the contextually significant fact that GameStop was profitable?

It is clear: much of mainstream financial media is actively propagating biased narratives to the benefit of the faction that has a vested financial interest in the share price of GME going down.

---

An interactive version of this article can be found at gmetimeline.org/fy23-profitability

For the first 3 quarters of FY 2023, GameStop has posted a total net loss of $56.4 million.

Therefore, in order to achieve full-year profitability, GameStop must achieve greater than $56.4 million in net profit for Q4 2023.

This is certainly achievable, though not guaranteed.

Something like a $100 million net gain for Q4 is possible, but not necessarily very likely.

Therefore, in any case of full-year profitability, at best, the PE ratio for GME will almost certainly be above 100, but will more likely be in the several hundreds, or worse.

By comparison, the average PE ratio for S&P500 is around 25.

https://www.macrotrends.net/2577/sp-500-pe-ratio-price-to-earnings-chart

Some PE ratios of other companies:

• Microsoft: 37
• Apple: 26
• Nvidia: 213
• Amazon: 89
• Alphabet: 27
• Meta: 42
• Berkshire Hathaway: 10

TLDR: Full-year profitability will be a momentous achievement, but in almost all cases, GME would have a very high PE ratio. Over the following quarters / years, GameStop will still need to increase profits substantially in order to obtain a good PE ratio.

Breakdown of GameStop stores by Technology Brands stores versus Video Game Brands stores versus all International stores

Google Sheets Link

And for fun,

GameStop Net Income Per Store

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Fiscal Year	Revenue	Net Income	Store Count	Revenue Per Store	Net Income Per Store	10-K
2005	$3,091,783,000	$100,784,000	4490	$688,593.10	$22,446.33	link
2006	$5,318,900,000	$158,250,000	4778	$1,113,206.36	$33,120.55	link
2007	$7,093,962,000	$288,291,000	5264	$1,347,637.16	$54,766.53	link
2008	$8,805,897,000	$398,282,000	6207	$1,418,704.20	$64,166.59	link
2009	$9,077,997,000	$377,265,000	6450	$1,407,441.40	$58,490.70	link
2010	$9,473,700,000	$408,000,000	6670	$1,420,344.83	$61,169.42	link
2011	$9,550,500,000	$339,900,000	6683	$1,429,073.77	$50,860.39	link
2012	$8,886,700,000	-$269,700,000	6602	$1,346,061.80	$40,851.26	link
2013	$9,039,500,000	$354,200,000	6675	$1,354,232.21	$53,063.67	link
2014	$9,296,000,000	$393,100,000	6690	$1,389,536.62	$58,759.34	link
2015	$9,363,800,000	$402,800,000	7117	$1,315,694.82	$56,596.88	link
2016	$8,607,900,000	$353,200,000	7535	$1,142,388.85	$46,874.59	link
2017	$9,224,600,000	$34,700,000	7276	$1,267,811.98	$4,769.10	link
2018	$8,285,300,000	-$673,000,000	5830	$1,421,149.23	$115,437.39	link
2019	$6,466,000,000	-$470,900,000	5509	$1,173,715.74	$85,478.31	link
2020	$5,089,800,000	-$215,300,000	4816	$1,056,852.16	$44,705.15	link
2021	$6,010,700,000	-$381,300,000	4573	$1,314,388.80	$83,380.71	link
2022	$5,927,200,000	-$313,100,000	4413	$1,343,122.59	$70,949.47	link

Fiscal Year	Revenue	Net Income	Store Count	Revenue Per Store	Net Income Per Store	10-K
2005	$3,091,783,000	$100,784,000	4490	$688,593.10	$22,446.33	link
2006	$5,318,900,000	$158,250,000	4778	$1,113,206.36	$33,120.55	link
2007	$7,093,962,000	$288,291,000	5264	$1,347,637.16	$54,766.53	link
2008	$8,805,897,000	$398,282,000	6207	$1,418,704.20	$64,166.59	link
2009	$9,077,997,000	$377,265,000	6450	$1,407,441.40	$58,490.70	link
2010	$9,473,700,000	$408,000,000	6670	$1,420,344.83	$61,169.42	link
2011	$9,550,500,000	$339,900,000	6683	$1,429,073.77	$50,860.39	link
2012	$8,886,700,000	-$269,700,000	6602	$1,346,061.80	$40,851.26	link
2013	$9,039,500,000	$354,200,000	6675	$1,354,232.21	$53,063.67	link
2014	$9,296,000,000	$393,100,000	6690	$1,389,536.62	$58,759.34	link
2015	$9,363,800,000	$402,800,000	7117	$1,315,694.82	$56,596.88	link
2016	$8,607,900,000	$353,200,000	7535	$1,142,388.85	$46,874.59	link
2017	$9,224,600,000	$34,700,000	7276	$1,267,811.98	$4,769.10	link
2018	$8,285,300,000	-$673,000,000	5830	$1,421,149.23	$115,437.39	link
2019	$6,466,000,000	-$470,900,000	5509	$1,173,715.74	$85,478.31	link
2020	$5,089,800,000	-$215,300,000	4816	$1,056,852.16	$44,705.15	link
2021	$6,010,700,000	-$381,300,000	4573	$1,314,388.80	$83,380.71	link
2022	$5,927,200,000	-$313,100,000	4413	$1,343,122.59	$70,949.47	link

As many are aware, the SEC recently published Incoming No-Action Requests Under Exchange Act Rule 14a-8, and there were several shareholder proposals submitted by GME shareholders that were rejected by the company that were published there.

There have already been a few discussions of these proposals on Reddit and on X and on Discord at least.

Some of the discussions about the rejected proposals have been nothing but negative and cynical and even disparaging towards those shareholders that submitted proposals.

So I just wanted to make this post to express some gratitude towards those shareholders that submitted a proposal, despite that GameStop rejected them.

It's really easy to criticize. It's very easy to sit behind a keyboard and put other people down while otherwise contributing nothing. It takes almost no effort to do this.

It's hard to build things, it's much easier to destroy things.

Those shareholders that submitted proposals are the types of people that are builders. They are activists. They are building and advancing our collective knowledge.

Some other people are not builders. They are destroyers. They revel when the builders struggle. They celebrate when the builders face setbacks. They scorn and shame the builders for having tried at all.

I sincerely appreciate the efforts of any shareholder that took the time and energy to submit a proposal, any proposal at all, even if it gets rejected.

Every little thing that GME shareholders do that produces additional knowledge is beneficial overall to all shareholders.

Some parties out there in the world that are in opposition to GME shareholders don't like this. They don't like it when GME shareholders get loud and get active. They would much prefer it if we would all just shut up and go away and forget GameStop.

That's not going to happen. I for one am not going anywhere.

🍻

The last time GameStop posted positive full-year earnings was in 2017.

There has been a fair amount of talk of GameStop posting full-year profitability for the 2023 fiscal year, which is definitely within reach, but not guaranteed.

If GameStop posts full year earnings for FY23, it will be the first time in 6 years. It will be a momentous occasion!

It will also demonstrate that the prevailing sentiment put out by mainstream media doesn't reconcile with the reality that this company is not the loser that they want the world to think it is.

December 6, 2023: GameStop reports 2023 Q3 quarterly results

• Earnings Release
• 10-Q

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Net loss of $3.1 million for the quarter

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All of the information in this diagram is derived from this section of the 10-Q:

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Earnings discussion thread (December 6, 2023)

TLDR:

• CNBC is financial propaganda designed to further the interests of its owners.
• CNBC is owned by Comcast, which is 88% owned by institutions (Wall Street)
• The owners of CNBC is Wall Street, and what Wall Street wants is more money and power for themselves and less for everybody else.
• When a person watches CNBC, they are consuming information designed to take money out of their pocket and put it into Wall Street's pocket.

• The purpose of CNBC (and other financial propaganda outlets) is to help Wall Street get more money and power for themselves and less for everybody else.

---

I recently saw this post and it made me curious to see how Upstart has fared since that CNBC interview was originally aired.

the original video clip appears to be from an October 15, 2021 CNBC interview with a guest by the name of Mark Minervini.

If you go to that CNBC link to view the clip, you will not find the part where Mark Minervini reveals that he has no idea what Upstart Holdings even does, this part has been conveniently removed.

Wikipedia says: "Upstart is an AI lending platform that partners with banks and credit unions to provide consumer loans using non-traditional variables, such as education and employment, to predict creditworthiness. "

By matter of pure coincidence, October 15, 2021, the same day that the original CNBC interview aired, was also the same day that Upstart Holdings was at an all time high market valuation.

So, recap:

• in late 2020, some company that nobody has ever heard of called Upstart Holdings, ticker UPST, that performs some vague "AI lending platform", does an IPO
• UPST rises from IPO all the way until October 2021.
• October 15, 2021, wall street finance propaganda channel CNBC gets some stooge to sit in front of a camera and shill for some ticker that he doesn't even know what it is. "Upstart is up about 25 percent just in four days, that's a good looking name. Very powerful, very strong earnings, " this is the type of great due diligence that CNBC has to offer here. It's a great stock because it's up and up is good. Put your money in now, because stock goes up.
• (the movie The Big Short draws attention to this concept of "Hot Hands" that is a bias that people have: "people think whatever is happening now is going to continue to happen into the future")
• October 15, 2021, to present: UPST is down more than 90% since CNBC was pumping it.

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Who owns CNBC?

CNBC is owned by Comcast, which is 88% owned by institutions (Wall Street)

What is CNBC's purpose?

The purpose of CNBC is the same purpose any propaganda machine.

Wikipedia provides this handy definition of propaganda, emphasis mine:

Propaganda is communication that is primarily used to influence or persuade an audience to further an agenda, which may not be objective and may be selectively presenting facts to encourage a particular synthesis or perception, or using loaded language to produce an emotional rather than a rational response to the information that is being presented. Propaganda can be found in a wide variety of different contexts.

Propaganda is the art of manipulating the perception of the target audience using a variety of lies, deceptions, and omissions of information.

It has been famously said that all warfare is based on deception.

For example in the context of a war, propaganda can be used to motivate your own troops by selling a perception of strength and success, and it can be used to demoralize your opponent's troops by selling a perception of weakness and defeat. In war, propaganda is simply a tool used to help the war-interests of the party that is utilizing the propaganda.

It's the same in the world of finance. Financial propaganda is designed to manipulate perceptions so that the person or party that is doing the manipulating may somehow benefit.

The owner of a propaganda machine like CNBC deploys the art of deception and the outcome is that the audience that consumes it subsequently hands over their hard earned money willingly and places it into the possession of that same propaganda owner.

The victim is led to believe that the information they consumed was a hot tip that might help them make some more money, but of course it was actually just a trap that took their money and gave it to Wall Street in stead.

This is a December 2023 updated version of this chart which was previously posted.

• Original chart by visualcapitalist.com November 2020
• Updated chart by visualcapitalist.com December 2023

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This is a chart that shows information that is relevant to the interests of GME investors.

What is once again glaringly obvious is that mobile is the largest and growing area of video gaming revenue.

As it seems that GameStop is disengaging from web3 related ventures, in order to grow and succeed, GameStop will need to find reliable revenue streams.

How could a company like GameStop get a cut of that mobile gaming revenue?

TLDR: the terms "Book" and "Plan" continue to be deliberately confused, in places of significance, and this is why it's important to continuously reiterate the simple true statement that

📢 plan is not DRS.

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Somebody makes a post in superstonk that makes reference to the distinction that plan is not DRS.

In response to this, superstonk mods reply and pin to the top of that post a template message over 600 words in length that would confuse somebody who didn't know better about the plain indisputable reality that Plan is not DRS.

"Plan versus Book" is a misnomer because all electronic shares are book-entry shares. This includes Plan (aka DSPP aka DirectStock) shares and DRS shares.

It only takes 4 words to reiterate the correct truth of this distinction, the distinction being that plan is not DRS, but for some reason this is something that continues to be deliberately confused to this very day in 2024 by people that have authority over the largest online community of GME investors.

The messaging by moderators of the largest GME community has consistently been deliberately confusing and misleading, and will lead to the outcome where uninformed individuals will have an incorrect view about what is DRS and what is not DRS.

Who benefits from this?

Why do the unelected, unaccountable moderators of the largest online GME community continue to perpetrate a misleading view about something that is now so plainly indisputable?

---

A brief history of "plan versus book":

• November 19, 2022 - Ryan Cohen tweets: "I also want to be the book king!"

• "Plan versus book" enters the conscious awareness of superstonk, and thousands of people start discussing this.

• Superstonk mods, slowly but surely, from Nov 2022 to January 2023, put a damper on these conversations while at the same time injecting their own several-hundred-word-deliberately-confusing message into these threads and pinning that message to the top so that everyone has to see what they want everyone to see, above what the community is talking about. "HEY OP. IT LOOKS LIKE YOU WANT TO TALK ABOUT PLAN AND BOOK. PREPARE YOURSELF FOR 600 WORDS OF PURE CONFUSION"

• By January / February of 2023, threads about "plan versus book" disappear from superstonk. On odd occasion a post about this topic would come up, and get removed with a justification like "this post was removed because we already had to moderate this kind of content before!"

• if the objective was to prevent further discussion of the distinction between plan shares and DRS shares, it was successful.

• in April 2023, a post is made in a different subreddit, r/DRSyourGME, that re-ignites the discussion about this topic that was successfully silenced up to that point

• superstonk mods tried hard to censor this topic and remove any and all mentions of what was being discussed over in r/DRSyourGME. But, their attempts at censorship failed.

• uh oh. the truth is leaking beyond superstonk's walls. Can't have that. superstonk mods publicly denounce the folks from the r/DRSyourGME subreddit and accuse them of acting inappropriately.

• Reddit decides to ban the subreddit.

• June 2023 to early December 2023 - "plan versus book" once again disappears from the conscious awareness of the largest GME community.

• December 2023 - in a live X spaces earnings call for GME Q3 earnings on December 6, an important conversation takes place that once again draws attention to the existence of the distinction between DRS and DSPP. It is once again re-iterated that DSPP is not DRS.

• December 8: Why are DRS numbers stagnant? Exploring the possibilities ... Plan is not DRS - post by Chives

• December 9: that post is then posted to r/GME

• Why is this important distinction being talked about by GME investors but not in the biggest GME investor subreddit?

• Apparently, the effort to continue censoring is waning. By whichever reasoning, perhaps out of the self-interested understanding that continuing to censor the topic leads to suspicion, superstonk mods relent and so graciously permit a post about this to exist.

• December 22: Plan is not DRS - a post is made by jackofspades123 based on the original post by Chives.

• December 22, 2023, to present: After over an entire year of this, the effort to confuse and silence discussions about the distinction between plan and DRS have failed. Censorship is no longer a viable method of information control on this topic. Time to switch gears back towards propagating and pinning a template comment that deliberately confuses the words plan and book, while continuing to ignore the important thing that plan is not DRS.

• any new GME investor that is interested in DRS that gets exposed to this misleading information risks having their shares enrolled in a plan, even though what they were really seeking was DRS.

---

Who benefits if people are misled or misinformed about the distinction that plan is not DRS?

I don't necessarily know who benefits, but I know for certain that individuals seeking to inform themselves about DRS do not benefit when what they actually end up consuming is misinformation.