GME Q2 2024 Earnings Review LIVE - What Next For Gamestop Amidst Falling Sales?

let's go yo I'm like an addict oh I got to have it I ain't even playing got a really bad habit If It Moves got to grab it fuse like a magnet lose won't have it till I'm doomed in a casket I ain't playing got a weird mind if you work eight hours I'mma work nine if the tastes sour you should taste mine I'mma stay in power for a long time get up n ain't a quitter toss me the ball I'm a really big hitter big picture I'm a straight killer ring song to the highest bitter Got Juice got gas I'mma move fast new shoes new tracks like who's that I'm new come back better than last year so know me never going to look back I'm never going to look back cuz damn I was built to last you move slow when I move fast and that's back only I can make a change slowly take a step today I will never be the same cuz that's what it takes all right guys welcome May how are you doing oh 911 how sad right yeah yeah people forgot I guess but I I still remember exactly where I was that day uh when it came I remember two things when when the space shuttle blew up I was walking on campus at UT Austin I know exactly the spot I was standing on and uh when 911 happened I was about to leave my neighborhood to go go to my corporate job and I I just turned around I didn't even get on the road to the highway I turned around went back to my house and I just watched TV all day yeah like so horrible paralyzing isn't it it was so paralyzing it's pretty horrible yeah I was in the Sears Tower and um we evacuated and then um I was working for uh the man so to speaker dealers that you know and I remember they sent message that we should um continue working because it was not a paid day off and oh hell no I swear to God yeah I was that was probably why you know I've chosen other employment but I think subsequently they probably have felt really stupid for that and but I spent the rest of the day rescheduling meetings strangely enough in making sure people had rides because my coverage at that time was through all the Midwest so it was a really weird and then I just was in shock for like the next 24 hours I I mean it was bad enough watching it on TV I can't even imagine being there well no I was in the SE so like the oh Chicago Chicago yeah so the last plane though they say was headed there but we were you know we owe a lot I was thinking Empire State Building when you said it's hard because your yeah your brain just kind of like crosses all the big I never lived up that way may I just visited I've been to Chicago New York twice for vacation so we've got some folks that remember when JFK was killed yeah these big days and these big events but we're here to keep it light we're going to talk about GameStop do you have a drink may we might need it to get through this yes it's almost gone I like I'm halfway through my Corona but I got I got another one on Ice Wednesday it's only Wednesday but it's Friday somewhere yeah that's true all right I'm gonna well that's that's what I'm going with anyways somebody's Friday somebody only works certain days uh we got the GameStop second quarter results May uh it's my fault for us being late tonight guys because I've been working I've been working on what was supposed to be my quick GameStop summary video and I decided oh everybody has a lot of questions on X Y and Z so let me talk about that let me talk about that let me talk about that get all these questions knocked out for people that don't want to watch a live and hang out yeah but I was having trouble getting it uploaded anyways it just uploaded about one minute before we started so uh if you don't want to hang out for live that is an option but we are here to just talk about this at a high level to answer questions with us guys seriously more importantly may I I got the impression this is why I reached out to you yeah I saw you tweet about the GameStop earnings and you and I haven't talked about this but I got the impression from the tone of your Tweet you had more to say oh yeah you know I feel like subsequently there's been a lot that's been published but my initial reaction you know I I don't I don't do much on GameStop because I know because you know the thing is he first of all he doesn't have a call so there's nothing to really comment on if you C if you take that and try to compare to financial statements which is the style that I do right for you it's a little different for others it's a little different but for me my style is to try to um really to articulate what I'm seeing in the financial statements plus what management is saying they're strategically trying to do uh that said on all the mem stocks because there's so much like fake news there's so much really nasty venomous ways that people talk about it forgetting that a lot of people just put their money here and this is their investment I do like to just monitor it to see and I would say that the thing that I think I posted that kind of got taken in a crazy way is that this earnings report um especially in the context of the past few years of earnings reports really doesn't show what I would have expected it to show by the third and fourth quarter which is some sort of positioning ahead of the holiday season the only thing it really seems to demonstrate is that he's continuing to pair the business down pretty aggressively and like it's almost like he's hollowing out the like the words I used it really I think ended up being quite triggering for some people is it's it really feels like he's hollowing out the the company to make it a container for someone else to buy the container and that can have some you know if by itself like if you have no other information and so I'll give the other possible positives later but if you have no other information all things being equal that's typically done in a way that's not necessarily fair to the folks that you're deluding as you're doing that asset raise um and the the buyer might be really stoked about that and you could I mean if if the if the because it it almost looks like a so the I think the return the real term for it is it looks like it's trying to become a reverse merger uh container that's what it looks like right so reverse merger means that the company that you're buying actually is a Better Business and for whatever reason they want some of your assets so they're willing to just merge with you but somehow keep your brand your name or some reason why you're public and they are not public so that those are the major reasons why you do a reverse merger um maybe there's others and if I forgotten them feel free to put it in the the comments um but that's that's what it looks like why does it look like that because you have the Core Business continuing to get smaller you have inventory staying like whereas it was flat last year it's actually um down versus last year going into holiday season now some of that is driven by whatever's going on in the gaming cycle if I saw it correctly I think I did but there was something really awkward in the way that I was looking at it on my phone um and then you have this massive Capital raise with the cash but you don't have him deploying it right away and then you have this new capital raise of 20 million shares also being filed as a shelf super cool don't know if they were out of room on their previous uh filings to to do more such that they just had to renew the Shelf but I'm not sure given that you have all this cash what it is you want the capital for if you read the dis if you read the um the perspectus on the the shell filing you'll see that the use of protees is really General but they intonate in like in the in the use of proceeds and they're very clear that it includes potential Acquisitions for the purpose of you know that are in line with what the company said it's going to do well the crazy thing is the company hasn't said it's going to do anything so I'm not really sure what that means it is very standard verbiage so it might just be that the banker was being lazy let's write it in and move on but there's no stated use of proceeds you have four billion in capital you have no stated use of proceeds but you have another shelf offering to raise a ton of equity Capital it's all really kind of strange to be honest so let me just throw a couple things at you uh typically they load up on inventory starting this quarter that they're in right now so like third quarter is usually most people I mean maybe fourth quarter you'd see it like escalate but right now we're below the previous quarters inventory well because they're they're they're cutting Stores May yeah no they have been though this entire so you would expect inventory to go down because you have a smaller footprint okay but let's look at inventory really quick we're at I I have it on the screen here yeah so how many stores did he he eliminate well we don't know they only tell us once a year in the 10K okay so so previously I had seen maybe like a 10 15 like 10% decrease in I think it was 5% me was like small right 5 10% total I have it here uh 5% okay sorry so even worse than what I was saying right so unless they really got rid of a lot of stores that's a big decrease in inventory because if you'll REM one of the things that I've watch for is inventory has decreased a little bit but it hasn't like quarter over quarter you know well I mean you expect a lot from holiday and then going forward but you like last time I remember I thought it was weird that the inventory was flat if I go back to last year right so let's go let's just go the inventory line here's here's Q2 of last year it was 676 million and then at the end of Q3 which is the one they're in right now yeah it bumped up to a billion yeah so I mean if you figure some store closures 676 down to 560 would be in line and then we'd expect to see a bigger number on the next earnings in three months so um okay so Q4 682 to 632 so what's the decline what's the number 67 76 to 560 see I would haveed something with a six handle still okay so okay but if you okay if you want to do it that way then we can do q1 756 to 675 right so that's a 10% decrease so are you saying that you think it's about 10% stores change uh there was a footnote in I don't know I mean I I have no way of knowing how many they are closing other than I did spot a footnote that is new in this 10q uh fact let me just pull it up we can look at it together because I haven't seen anybody talking about this and I actually forgot to mention it on my video had so much uh stuff that I wanted to cover this one we have initiated a comprehensive store portfolio optim optimization review uh da da and it says we anticipate that it may result in the closure of a larger number of stores than we have closed in the past few years okay so yeah and there's going to be an impact to sgna in the short term yeah so wind down so what I'm saying so there's a couple different ways that a person could do this right you can have you can have uh let's say let's say so if so can we let's just calculate the percentage really quickly from that previous slide on on inventory to decline so 676 um it's like yeah so it's like almost 20% is that right what are you looking at 759 to 676 uh six are we comparing Q2 2025 Q2 2024 are you yeah I don't know which one you're comparing that's what I'm asking so the inventory declin is about 116 million if you're looking year-over-year yeah yeah so the year because you would because there's definitely seasonality so you've got almost 18 and change percent almost 19 19% decline in inventory seems like a lot for a 5 perent store reduction that do yeah yeah that's my issue yeah but but so so if we're optimizing too the other thing that you'd often see is you see lower store count but you would see inventory still in line so optimizing would mean we get rid of the stores that aren't selling as much and you put their inventory in a better store so you so you know unless unless the store decline is something like literally in line with this in I mean it have to be actually slight it would have to be closer to 20% right because if it was if it was only seven let's say that's 18 and change we'll use 18 okay somebody else can put the math in the comments or something and just be my be My Savior on that so like 670 676 divided by 560 I think is the number right so if if the if the inventory client is 18% and the reduction in stores is 18% it's not very much of an optimization you know I mean so like really it should be you know because technically the stores that are remaining should be selling more per unit per store unit right you would think that's what the GameStop YouTubers tell us that this is great that they're closing stores the on is it a remaining or going to sell more because now you don't have another one right across the street yeah and that's possibly true we don't we don't know the answer because he didn't published a number so right it really depends but it looks to so so number one on the next earnings release you'll need to see what exactly is the reduction in inventory versus the reduction in stores so if they reduce stores by like 25% and inventory only went down by 18% then what they actually did was increase in inory per store and we need to see the sales through right if if it's some other mix of that you're missing a pretty vital piece of information but ignoring all of that you you your your inventory reduction is really high so like so like how many stores did you get rid of it's it's not it's you know it's it begs the question and that's that's why it'd be nice to have some comments from on any of this stuff right yeah so sure of having better information it it kind of looks like he's just still gutting the company after all these years now if you look at like everybody always wants to compare to AMC and they're like AMC sucks blah blah blah but largely speaking the decreases in theater count the the the biggest Delta on that the biggest change in that has already happened and then what's happening right now is just rollof of contracts that are ending peacefully and gently you know I mean like you're not really seeing this massive decline with massive AMC is reducing theater count by 10% but revenue is growing and we got too right we got an opposite problem here they're reducing stores because sales are falling and sales are falling because they're reducing stores and you know where where's the safe where's the safe landing but the the theater count isn't down 10% this year I'm talking about since 2019 oh sorry yeah okay that see 10% since 2019 is like okay I get it nice chill slow we're trying to keep the business approximately the same you have a one I mean you're showing a you know first of all you're showing a massive decline in Revenue right okay cool but you're also showing a massive decline in inventory so I I have to actually really understand what got sold you know what I'm saying what exactly happened that that's all if it was a smaller number yeah let me throw something at you for the people that are probably yelling at their screen but may you don't understand they know they're over stored and they know they need to reduce uh the store footprint and that's part of the plan uh because they're going to Pivot into Omni Channel selling on the web blah blah blah blah blah and and maybe do something else maybe acquire somebody in their you know in their segment with that4 billion dollar so maybe this is part of the plan to wind down the Core Business a little bit maybe not to hollow it out for a a reverse merger what how would you react to to that type of debate question okay so anything is possible but with the market Cap's nine billion is that right uh I think eight with just under nine yeah okay so let's call it nine you have four and a half billion dollar I I have it here hang on yeah we can just look uh 8.8 okay so we'll call it nine to keep it simple so eight even though 8.8 is a luckier number to be honest the Asian and me wants to go with 8 so 8.8 billion all right we're gonna go with that because it's such a lucky number eight8 right okay so like so 8.8 billion 4.5 billion in cash they're going to do an acquisition that's why I'm saying it looks more like a reverse merger than it does because you're basically you know you're Enterprise value for the company right now now is going to be your market cap minus the cash so your actual Core Business um is is not actually that big so that's why I'm saying like you're becoming a shell and you'd have to back something into it um most likely and it's going to be let's say it's an all cash deal okay right because if you use stock right now then that's not going to go well for Equity investors and it won't go well for Equity investors because the only thing you'd be able to use is some multiple on um on on the fact you'd have to remove the cash so you get almost nothing for the cash but then why would he do that because his job the board's job is to uh get the best deal possible for shareholders whether it's a reverse merger or acquiring someone else and just growing the company again figuring out a way to grow earnings why would they consider a reverse merger if that is going to be de mental to shareholders so here's the thing so I've got some people they're like they're simplifying what they sell they're all this stuff no no no 4.5 billion Capital raise doesn't explain any of that actually with if that if all they were doing was simplifying The Core Business you would see massive um iida increase earnings before interest tax appreciation amortization is what EA stands for or you can just look at operating cash flow sub um subtract out capex okay you would need to see that number like jacked up high but he actually not trying to jack up free cash flow because all he's doing is paying down his AC crudes like crazy okay so if I saw him stop doing that generating a bunch of cash and and still selling stuff off then I might be okay okay that that whole thing which you just described which is selling more clothes and TV or whatever that would make sense that would be the that would that's what that corporate you know if you're ask if you're like hey if what you're trying to do is consolidate reduce and whatever that's what that looks like when you look at financial statements this looks like someone has told him that they're going to essentially wind down massively The Core Business and use the capital to become something totally different so examples of that would be like Corning ticker GLW back in the day that company made glass okay now it makes like it makes very very high-end Glass Technology for whatever and and it might have looked like this right other companies that have done it let me try to think of one that's more in recent history because that that happened so long ago it's not even funny um uh with that transition oh what looks like that now or that has done that now oh my gosh I'll think of it I'll think yeah let me know because it you're you're you remember far more of this stuff than I do like I wasn't paying attention to to that stuff back in my younger days I was doing my corporate job so yeah this that's why I appreciate you whether you end up being right or not just having the the discussion so that we could either learn or maybe you'll end up being right and that'd be pretty cool you know if you if you figured something out before everybody else well okay so like if you're gonna do this if if it was the case like if if it was the case that there was a possibility for what's called a rollup strategy it might look like this okay but there's no other real competitor to GameStop that's doing specifically that type of stores so that wouldn't make sense like if you were a healthc care company and you were doing something like Home Care something like that right where you do SE senior care but you know uh they call you and you bring you know senior care inhouse it's called the home care business right like let's say you're doing that and you raised a ton of capital then very clearly it would look like this and you would not be like doing any capital expenditure and then I would expect a series of acquisition announcements but the thing that makes that a little bit awkward is that I would already see the core business set up to be attached to other Acquisitions and I don't see that yet now maybe I just don't know and it's totally okay I'm not saying them in the end I'll be all I'm just really trying to add the little value that I can add is looking at this and telling you what it would mean if you just gave it to someone took off the name and said May what is this company trying to do I this is what I would think it would potentially this is the question yeah May I'm I'm sure you saw that accounts payables you know getting whittel down right I'm I'm sure you saw capex was almost non-existent these are these are kind of like strange things that stood out to me yeah exactly exactly and people are gonna say well of course they're whittling it down you know why would you want a a big accounts payable but we we look at Trends right and this I mean it's counts payables dropped from a billion bucks to 220 million in a couple years oh this is so funny I love this IP K yeah yeah so like that those two things are part of why I'm like he's hollowing out the company because if you're not even so like you would expect in in a typical like I'm gonna optimize even if you use something like AMC which everybody's like you're just talking about you know no if you look at AMC the capex numbers were really big when they did actually attempt something somewhat close to this strategy but not in this particular approach right they definitely were trying to do a roll up in 2018 um when they did the debt raise because they were trying to do with debt with because debt was so uh cheap at the time um and when when they did that the first thing you saw was a massive capex now they went and acquired a bunch of theaters um because they were trying to just roll up within the same industry but that's my point like like if you if I saw something in capex I'd be like oh clearly they're like really doing something they're they orienting themselves to start to do something very different all right the only business that this amount of capex would let you do is become a private Equity shop but explain that explain this capex thing because that was my first question when when you mentioned that on Twitter the other day all right I don't get it may pretend I'm dumb I am dumb you're not dumb I don't I don't understand you you obviously know something uh you you're trying to explain something but I'm not getting it um why would why would you see capex increase if they're planning something okay so start so let's let's explain the opposite right so if you were really just trying to optimize your existing stores if that's really the only thing you were doing then you would be reinvesting in your existing stores and then you would be you would be selling off the other stores and I would see a very specific cash flow usage from the sale of stores right I don't see that what I see is you are not reinvesting anything in your existing stores to upgrade them change them or otherwise improve them and you you're definitely selling off the other stores and then you're just keeping the cash when when I saw the capex number I was like good Lord these poor employees like what kind of what kind of work environment must that be like oh I I got a maintenance request but nobody will answer it because they they don't have any budget for capex it's that's what it feels like to me that like e either that or they had a budget but they just decided not to spend it that's possible too okay so so that's the first thing and I was like okay that's weird so then what could you be using the capital for so so so really when you see a low capex number and you don't see the spend in other places you're like the the business is identical so you're not optimizing in the sense of improving the existing stores you're optimizing meaning you're just getting rid of stores there's there's like there's not that's not really optimizing that's really just removing you know what I mean optimizing actually applies increasing doing something new at the existing store so it could be like figuring out a new way to sell to people and you would see some capex maybe there it would be like doing a big um build out in technology that somehow helps you you know it could be like there's a bunch of things that it could be um that should show up in as a use of cash as as a part of your free cash flow usage right um and then what was the other thing that was the question oh uh yeah well that was the question like what what would why would you expect to see capex going up to set them up for acquisition it would at least tell you what what approximately they were trying to do right so they were if they were trying to optimize the stores like make them nice so they could sell them you would see CeX if they were trying to CH transition the stores to something new and Innovative you would see CeX well maybe they haven't figured out that's the people were saying they're taking their time May they're just waiting for the economy to crash and everything to go on sale cheap and then they'll buy whatever competitor or you know Cherry that they got their eye on they'll buy it when it's cheap when the market crashes it's a really valid point except what are the competitors is there is there a GameStop competitor I I just said competitor there's not really one but let's just say it's a gaming company you know software company I'm just making up examples I maybe they could buy toys or us out of Macy's I'm sure Macy's would but it's only a brand at this point Macy's is the one that UPS the inventory and it's all the indidual um the only okay so then the other thing that that this might look like is if they were really transitioning like completely out of retail into something else you know so like well that is what some people have postulated is that they're trying to really ramp down retail and just become a online store no this is not even online store because You' see the cap X right that's what I that's see see how that all circles back now we got to answer your question because you'd expect to see some capex to show that they're starting to really invest in uh building out the Reta the online store right would you see something like you'd see something I mean unless this is a really cheap build out because we're talking about like three three million dollar is that it a year ago May the capex was 10 million we're talking a reduction from 10 to three in 12 months okay so maybe they built it all 10 but then you like is the tech is is what you've seen in the last year so amazing on the 10 million spend that you feel like they should be winding down the spend I don't know I mean I occasionally go on Reddit and I read on the GameStop Reddit Channel where employees post and I mean I don't check it every day but I see a lot of complaints from them that management is inattentive or they can't get stuff fixed there's some of them that are happy it's probably like uh you know any company if if you're in a location that's already targeted for shutting down they're not going to pay you much attention yeah but if you're in a good profitable location you're you're probably getting the attention yeah so then steam somebody's posting that steam would be the closest competitor if steam suddenly wanted all of the real estate operating leases um and they had some massive thing that they wanted to do steam would not want real estate I know it's so weird I can't see them wanting real estate but let's say they did okay so just to give you an example of why what's the cash all about if they wanted to buy whatever was left and then use the cash for renovations and to pay down their own massive debt because somehow steam which is crazy profitable somehow mad some crazy maybe maybe but that's how weird it would be right like they would have to alternatively because gaming does have a lot of like a very weird structure as relates to venture capital and how gaming gets funded it's possible not pro I mean it's all it to me like if I had to put odds at this point I'd probably put 20% odds but it's not zero that they were gonna become a VC for gaming that is as like 20% odds is the best I'm G to give you on that right at this point because and I'd really need to see an announcement because I think that is like a lot of people's leading theory they're probably giv 80% odds for that okay but the reason that like you would see Staffing changes at a minimum and they would be announced in press releases but they're saying they're still figuring it out May they haven't figured out what they're doing yet they're taking their time yeah well let the man cook May I'm just telling you I'm just telling you what I see on social media leave leave Ryan alone don't rush him why are you trying to rush may he just got this money two months ago my favorite thing in the world is how people Express themselves on the internet the color I think that's a fair question like I'm gonna I'm gonna be the voice of the retail Trader is it are your expectations too unrealistic if he just got the money in June to expect that by August he's already got a plan yeah actually you should have the plan before you asked for the money that's that's usually and the like he's in a very unique circumstance is where people are willing to give him the money even though he has an announced a plan okay so so if you look in the perspectives it's usually amazing the first section and this is the section that is used to then sue a company it's actually this section called use of proceeds so you're supposed to actually tell people what you're using the money for in this case it's like this amazing thing that that he has magical power with the other person that had ma this magical power was um Elon Musk but Elon Musk was very clear on what he was using the money for okay that so even though I saw some people on the internet being like well Tesla raised a bunch of capital is amazing blah blah blah guess what Elon was really loud and very articulate about what he wanted the money for so that would be one major difference between GameStop and you you know you gota usually you have to tell people so here the use of proceeds is so General it's just that I can acquire stuff which really from a shareholder perspective leaves you to really you got to really love Ryan and people do in fact really love Ryan and people really do believe him and he has a history of success so I have not so I'm really sensitive to saying anything negative but I would say um you know you can't sue him if he uses it on something crazy because because the use of proceed is just in line with whether a GameStop you know conceptually would make sense for for us I I'm one of those I'm one of those people may I'm one of those crazy people that is going to give my full faith to Ryan Cohen but my investment in GameStop is you know it's a it's very small so it doesn't matter to me what he does I'm not one of these people that has 20 or 50 or 100,000 invested in GameStop where they're really everything is writing on Ryan uh steering this ship properly through the channel uh but I I'm not a Ryan Cohen hater uh I I think I think he's a very smart guy I mean can we do the fun conversation about what AMC and really give it credit like really try to AMC being bought by GameStop because I know I saw that comment I was hesitant to read it but you went there mad ride says wait uh I Gotta Give Love To those people because they're on they were on my post as well and I'm like all right let's just we got two comments what um one said what about AMC and GameStop merging that's not on my short list of things that are ever going to happen but I know a lot of people think that it would be a good idea I don't really see what the Synergy is there other than they're both meme stocks but like company to company uh I don't know some people say well you know AMC could use part of its Lobby to build out a little GameStop shop but I don't know that there's enough square footage available in most AMC lobbies to meet GameStop's needs yeah I mean if you were going to do it but let's like if we were okay so let's say for whatever reason Adam Aaron who has expressed no ambition in this direction and Ryan Cohen who never says a word anyways decided like I don't know they just like decided to hang out at a meme convention and just we like we're gonna you know let's let's really let's let's blow their socks off blow their socks off let's do it okay so what would it actually look like would it be insane I don't know the answer to that I would say a few things would be helpful to AMC for sure because the 4.5 would definitely take care of the capital load did you notice May did you notice I don't know if you saw my tweet GameStop's cash exactly equals AMC's long-term debt I know it's like is that a coincidence Ryan coincidence to me it's as coincidental I know I'm just I'm just teas and it's a coincidence you know they're going around saying that Neo in The Matrix his passport said 911 I think it's probably in that that category but okay let's just say that did would it help AMC as far as the cash component yeah as far as like what would then happen next I mean I I would lean towards you'd really have to be aggressively stretching right so Ryan Cohen the GameStop does have at least some kind of more um extensive online shop right so AMC still hasn't built that out and would eventually have to create a Shopify for that that manages more swag from the movies okay that would be but that could just be done by a license agreement that do have to be done by entering a totally um non like totally separate new business that doesn't necessarily you know um would AMC get more distribution I don't think GameStop has enough like online gaming presence in the sense that like relatives something like steam then yeah you've got the potential to deliver movies on a game game console then maybe super long shots super not the core business of theaters but would technically at least have the word distribution in it I'm trying so hard you know um it just it it would be awkward it would be awkward I'm never gonna say no you yeah I'm not gonna say never it's just not a topic you're going to hear me talking about if it would be awkward uh how about uh mad ride says what are your thoughts on Ryan's dilution on GameStop in comparison to Adams on AMC I'm going to go first on this one may and then I'll I'll let you throw in whatever comments you have both com they're very different companies right GameStop was allowed to stay open during covid they had minimal income impact and they had much smaller debt load going into into covid AMC had a high debt load that was dependent on a constant Revenue stream which got cut almost to zero and then they're dependent on the movie industry which takes years to get restarted versus GameStop you know you're just waiting on stuff to be unloaded from from a ship so different businesses Adam and the AMC team I think knew that they were facing multi-year of uh liquidity crisis and and net income losses huge 200 250 million a quarter and so it was a necessity for AMC to raise cash or they would have filed for bankruptcy and they chose the fight path they could have just said well sorry guys this ain't we can't raise two billion we can't raise $3 billion so we're just going to call it a day give the company to the creditors they chose the fight plan and uh it it was unfortunate if you held all the way through it as a common stockholder right but I mean they communicated it very clearly Adam talked about the struggles and it was in every 10q and in the risk factors it was very clearly communicated delution I think yeah versus he talked about it in every call you know how the industry was strugg one sometimes he'd say oh well it's looking really good but we're still struggling and people get mad at him for doing that like why are you rug pulling us just say it's good because he wants you to know they're going to need to raise money he's he's trying to be as real as he can with you yeah then on the other hand we go to Ryan Cohen out of the blue right he just raises money out of the blue three times now since May if we count the one from yesterday uh and why does he keep doing it that we don't know because he doesn't communicate yeah so that's my thoughts I mean I think I I trust all CEOs to raise money for a purpose Adam had a purpose it was very well communicated in company documentation tweets meetings the struggles of the industry and the company Ryan on the other hand I think he has a plan I don't know what it is maybe May's ideas correct maybe it's something else but uh it's not very well communicated so how do we judge if he's doing the right thing or not we don't have any idea they clearly don't need the cash from another 20 million shares based on based on based on what we know which is we don't know anything go ahead M no totally I mean use of proceeds is everything in a capital raise and then if you want to go to the balance she or the 8K I have it up do you mind if I share screen real quick yeah go ahead all right all right share this one so if you look at this balance sheet August 3 then you've got total assets of 5.5 billion you've got total liabilities of 1.5 152 right yep yep so like I mean I gotta ask are you trying to turn this into a private Equity company I don't know what you're doing do you know what I mean like you haven't you haven't upgraded the stores you're just selling them all off this time at potentially you've sold at least 20% of the stores right you could care less about any cash flow that's being generated all it's doing it's not going it's going back to pay your crudes right here's the cash flow statement it's really the crudes that are getting paid y you know you you upped inventory a little bit from last year but you're so low on inventory relative you so like this you know this would be beautiful beautiful if somebody on your board was like you know what Ryan you have like you have like beautiful ability to raise capital in a way that I've never seen I don't have to pay fees on it I don't have to I don't have to like you know because like let's say let's say you were an asset manager right you gotta go out you gotta beg people for money then you got to pay fees and you got to negotiate those fees you keep 2% 20% it's not permanent capital they can still pull the money from you they can still pull the money from you here this is permanent Capital like the shareholders gave him4 billion doll in cash you know do you have any idea how hard it is to raise four and a half billion dollars of cash it is so hard a hedge fund might work for like a decade try to get its track record and it's still the case would not okay like it's like it's a phenomenal amount of money so like if you're let's say like somebody on the board what he really wanted in life was to create a private Equity Fund with some kind of very Loosey Goosey gaming Vision that would be like that would that would make sense to me I would be like what if what if he's just gonna become a a VC company or a a hedge fund not a hedge fund maybe that's not the right word but what if the intent is we'll have a small tiny gaming presence maybe an online store but we're just going to we're going to pick upand cominging companies or Bitcoin or whatever and just invest money and just kick back on the beach yeah and then could he be doing something like that and we're gonna make everybody rich with just our excellent uh capital gains and income plan yeah okay so whereas I gave the other thing like 20% this one I would actually give closer to 35% probability yeah I mean 35% probability like if I'm just like randomly throwing a dart at the probability board okay I mean there's a lot of people that think that that's what he's lining up to do just invest that money in something become what is it micro strategy where they have uh they just invested in Bitcoin like what's wrong with that what's wrong with that if he's gonna do something like that other than you're gambling with people's money it's just whether or not people understood that's what they were because the use of proceeds so that's that's why the use of proceeds is so IR relevant because the use of proceeds is so loosely written right now you know especially since he's literally said nothing on any of the calls about what the future strategy is so he literally could do anything and just be like yeah no that's always been my master plan and he's raised this beautiful Capital you know the stock even though it took a little bit of a hit didn't take a massive hit um as relates to the capital the announcement of the capital raise you know but does look like he's gutting the core part of the business and doing 30 my 35% probability goes to that and unless unless I get more detail from him uh all right so we we talked about uh a lot of people may don't want anyone asking questions like just leave Ryan alone alone let him figure it out that's one uh talking point out there oh um he he needs time time your your thought is he he probably should had a plan before he raised the money but what if the what if the Roaring Kitty thing was just a complete surprise and he's like well we should jump on this and we'll figure out a plan with for the money later that's I mean is that a possibility well that's why I'm giving 35% odds to the fact that some board member was like you know what we're really good at we're really raising we're really good at raising Capital at 0 perc interest rates that's what we're really good at which is a cool thing I mean that's elon's good at to be honest what what do you say to the talking point and I'm hearing this from numerous people and seeing it on Twitter and everything else the dilution is good you're not actually being diluted because your book value is increasing your book value increased from $4 to $10 therefore this was a good thing you're actually you're getting ahead as a shareholder with this dilution tell me your how would you react to that because I know how I reacted we own less of the company so is are like I'd have to do the numbers because usually that your book value should not it shouldn't increase that much anyways because you if you went from 300 million shares to 420 and Book value went from $4 to $10 yeah it is good I agree that's why I'm saying like 35% probability goes to the fact that he's a great asset Razer is it good for shareholders that got diluted and didn't didn't buy more shares to maintain their ownership of the company though it depends what he does with the cash hold on I probably should let me keep let let me really so that you guys really know that I like kind heart when it comes to GameStop and the fact that I would love for you guys to like make your money back he is really talented at raising capital for nothing I don't I don't think people really appreciate how how like out like there are in history been very few people that can do this and the value of that is potentially infinite if we look at Tesla do you know what I mean and and we don't have to just look at Tesla like Elon is a money raising machine he has decided to do a few things with it but all of those businesses started with nothing and became something like that's the beauty of the cap that's what real this is the unspoken amazing thing about the capital markets it is the unspoken amazing thing about America it is the unspoken amazing thing about the whole financial system is that you can take nothing and turn it into something okay but one key role in that and it's so vital and so precious that we have a whole in Industry called the financial industry surrounding it is the ability to command that Capital to get it to come to you the asset managers even the ETFs who have collected so much money they still have all this extra liability if they did you know if they don't follow the massive amount of regulation on top of it they still get fees from you associated with it and some cases they're very small if it's like a big ETF they still have all this thing Ryan when you give him the money from an equity Capital race he owes you nothing at that point okay he owes you nothing and that can be really scary for sure right for sure if he's an evil human being let me say it this way to keep it simple if he's evil your stuff goes to zero he literally took your money and you have some ways to Sue and and we'll see but if he's actually a good human being let's go ahead and give him the benefit of the doubt and then he he does something with it of value such as become like a a venture capital fund that has now raised four and a half billion dollars in cash that's funny cuz someone posted that exact comment uh we were talking about stop and I was like we're really just betting on Ryan at this point and someone said yeah if he's if he's a piece of we're going to zero but if he's a genius you know it's gonna it's gonna end up pretty good and that's kind of how I look at GameStop like I can't I can't look at the balance sheet and tell you what the the stock price is worth the stock price is worth whatever Ryan Ryan does with the money and nobody knows so my my I guess my message to anybody talking about game GameStop is if you want to be positive on GameStop I'm right there with you I'm positive on Ryan Cohen but when you put price targets out there like based on the balance sheet this stock right today is worth 50 bucks it's just not but it might be if he does something with the money it might be worth 50 or might be worth more gotta know what it is at this point so if you've been in it I don't know what to tell you it depends where you bought it at you know and it depends what kind of risk and what kind of time Horizon you have if you're new to it if it does get CL CED like crazy such that it's in like well definitely if it's like in single digits or something insane if it trades like anywhere close to just the cash you got a shot you got a shot as it as it closes in on on uh yeah but um we're we're over 2x cash right now may yeah I mean all the other stuff about pretending like this was an amazing quarter I get it I know why you guys are saying it I know why some people got really triggered by my post um sorry about that because that wasn't my intention to trigger I know you're you don't ever intend to trigger people you're just sharing your thoughts I know I'm sorry but but but like all that stuff is I mean like it's it would be like it would be like if you were you know like let's say Google has some small business that sells ice cream do you know what I mean you're looking at the wrong part of balance sheet at that point the 4.5 billion is what you need to try to understand you know what I mean at this point the rest of what's going on in gaming looks like and is very clearly stated to be winding down that is not going to be the future of GameStop and in the weird turn of events that you just don't get to see very often you have a guy with four and a half billion dollars in cash that clearly is making that what the future of the company is and has said nothing it's amazing you know yeah well I I'm I'm going to give him the benefit of the doubt may I for the moment trust Ryan Cohen and I have a lot of faith in him I'm just being one of those guys and I I've been very uh clear about this with my audience and some of the GameStop people hate me for it let me get rid of this screen she would tell I'm one of those guys that if I'm gonna take that gamble on Ryan which I'm willing to do I want the cheapest entry on this stock that I can get I know that's how I'm doing it too that's like it's definitely on my radar I don't know why that's such an offensive comment to people like you're you okay you're willing to pay 25 or 30 for it I'm not that's just my trading style my risk tolerance is not at a 25 or $30 level yeah it's I don't mind paying I bought some today at 1950 that's the you know I'd prefer to pay 17 or 12 but I don't know that it's going to go down there again so you know 1950 felt okay today we'll see what it does tomorrow could go lower depends on we got PPI we got the FED meeting next week there's a lot of variables besides just GameStop and at play so I don't just look at GameStop I'm looking like whole macro but uh I mean if I'm gonna gamble I feel like I'm just you know flipping a coin Ryan good guy Ryan piece of I I think he's a good guy I think it's gonna land on heads Heads he's a good guy but I still for my own safety want the best cheapest safest entry possible yeah I mean if you look at the so it let's so the way that I would interpret the revenue because a lot of people were like but the net income is so much higher so the revenue went from was it like one was almost 30% down did I get it right 31 31% wow here I thought I was like losing memory good good job okay so 31 so so you have a reduction of 3 so this is at that's why I'm saying if he did he possibly reduce stores by 31% like it is what we're seeing like like what exactly was the store reduction and if so yeah we don't know see the the red 30 see the red 31 that's the revenue growth rate year over year yeah so that's why I'm saying like really whatever is left is really mostly cash relative to what the business because you could pretend like oh market cap before they added the four billion cash was this so the company's actually valued at this without the cash um and that's the core stub business but since there's been no growth and all the other stuff is very confusing I'm gonna say no you can't it's really what it is because because clearly there's been so much change in stores from last year that whatever was going on La before the capital raises is nothing like what's left over what's left over is significantly smaller um yeah so it's really the cash right Ryan if you're watching this I can't wait to hear what you're gonna do to be I'm really excited to hear it I think I'm we're all gonna be pleasantly surprised I'm rooting for you my friend do you know but yeah uh let's see what else uh get wreck says cinemar hit a 52 we high in AMC won't move it's frustrating yeah I don't really want to talk about movie industry tonight because we're we're trying to stay focused on game stop but I've I've done a cinemark earnings video I'd recommend that you go watch that and I'm just going to say one's profitable one is providing forward guidance for increased positive earnings increased uh free cash flow and potential share BuyBacks and the others still trying to fix the balance sheet so just recognize them for what they are and you're gonna have to be patient on AMC if the box office grows some of the problems it has will get fixed but they're not in the same part of the race right now one one's ahead half a lap that's fair same with IMax IMax and cinar are in an inviable position and AMC's still playing catchup because they they have a larger footprint but that's all I'm gonna say I don't want to go off on a tangent I'm happy to talk about it any other night a different video at some other time when they won't report probably until November though usually that's when they report yeah yeah late right November will be the next one yeah so we got a while between now hopefully we get some really exciting I'm expecting a profit for a Q3 if we get over 2.45 billion domestic box which I think we're easily gonna get so yeah there's some good go see a movie uh Kevin says he bought some GameStop today under 20 bucks booya Kevin nice job I mean hopefully we don't know but I'm rooting for you I really am I I said in Discord when I bought it I don't give anybody instructions in the Discord I just say what I'm doing just like I do on camera but I don't make that many videos so my Discord is like hey for those of you that care because you're here in the Discord uh here's what I'm doing uh I I said I'm I'm buying at 1950 but I'm not going all in because I there's a potential for a lot of reasons not just GameStop related that we could go down and I'd much rather buy it 18 or 17 or 16 if the market has a little Dippity dip you know not nothing of GameStop's fault yeah I definitely have my radar screen and now I know what you guys are all buying it at I may actually dip my little toes in because I was trying to figure out where to dip my little toe to start out um I'll put it in I it'll it'll be small just so I could play along uh get wck says that is all he can do is close down stores and show a profit once that's done there is nothing to do but merge or sell he's not selling because he he has so much cash if he were to sell it would it would be bad for share I mean okay look you can structure sales a lot of different ways so I should give you that caveat but most of the normal ways that you would do it um like you know because imagine if you have four and a half billion dollars of cash that the old business is worth less than that cash then somebody that's buying you is buying that cash and they're not going to give you a multiple on it but right nowock has a multiple on that cash so basically you if he does that then then um he asset raised for someone else to buy cash from you it's like it's not usually the ideal thing for shareholders now can it be negotiated can someone do something really exciting yeah banking is crazy and people that are really good at structuring stuff have like all kinds of creativity that is beyond my me but what you really want is for him to acquire stuff not I'm I'm gonna guess let me know in the chat but get wrecked I'm going to guess that you're commenting as a non-g GameStop uh shareholder because I I see that on some of the forums you know people and I don't care guys I don't care whether you like GameStop or not I I only have a very tiny position that I bought today and I I I only swing trade GameStop for the last couple years so no one's going to hurt my feelings in this chat but people are people are saying the ones that are negative on GameStop well the only the only way this is going to end is he's gonna close it down or sell it but you're and like you pointed out May if if he sold it right now the price is at a premium 2x cash that's not going to work out where well for shareholders most likely so let's not talk about that scenario it would not be optimal what what the most optimal scenario I'm just I keep coming back to what can he do to benefit shareholders he could acquire something or invest the money into some venture or some security or asset that throws off more than 4% which is what he's stuck with now four or five% because even earning four or five% we're it's still Trading at 2x maybe one and a half x uh what the compan the the most of the earnings is coming from like a bond essentially right that's why I mean I I figured a four or five% on 4 billion with a 25 multiple the company's worth about 1275 a share with a 40 multiple that's worth maybe $18 a share you that's no one's going to be happy with those numbers so what do we need to do to bring earnings to the table to justify a reasonable PE ratio that's that's what they that's what I hope they're grappling with like how do we do this what can we what can we buy what can we invest in come a VC firm VC become a VC firm yeah I mean like hold on let me just look what's the multiple on like something like Blackstone which would be I think it's like three or something like Black Rock I think usually is around three for Book value right because then if you if you enter the world of Finance your metric then becomes Book value and right now you're at two so uh price a book oh yeah okay so actually that's even better like something like Blackstone is 15 16 times Book value but then that they always to be fair though you can't really do it this way because um Book value calculation okay let's just use Black Rock at three times Book value because that's closer to right with with with something like Blackstone I forgot there's like a way that the numbers roll up where the book value is misstated so that's but let's say three so then so then this is a two you have you have that upside spread if if what he's gonna do you know I mean it can't be more than three for would you look at Book value in a case like that because it's a a venture capital firm instead of looking at a PE ratio if my goal was to turn this thing into a venture capital firm then I would be paying you for the cash and then I would be paying you for whatever Investments associated with the cash okay so and most of those Investments would not be very profitable so I would be I would be trying to find alternative ways to value a price of sales blah blah blah blah blah this is this is a fascinating discussion like I don't know anybody else out there in the community that's like digging into this little what if this is a possibility so I'm glad you're I'm glad you're bringing it up whether or not it ends up happening that way it's still a a great little sidebar discussion yeah I mean like for me whenever I'm listening to the company call unless I don't like management so the company calls so my style of of like commentary is to listen to the strategies the companies say and then like map it to the the financial statements and if there's a mismatch then I you know might have some feelings one way or the other but if there's any gaps I tend to try to be nicer about it unless the Gap is clearly showing that management is a bunch of jerks I mean here I still want to believe that Ryan's not a jerk so I'm if I was like really Rose cuddler glasses as nice as I can possibly be that's what I would say and there's a part of me that really wants to believe that because you know he's an entrepreneur in background he grew up in the VC world so it's not like totally crazy that he really yeah you know what I mean he knows lots of folks that are like that he probably as a human being has an amazing network of people that would happily join him and he's in it is the case that not this part of ging but other parts of gaming do definitely have demand to try to fund um a whole brange of stuff within within gaming you know whether it's um software that's then used to facilitate games like a Unity or if it's something like individual games that they think will one day be Blockbuster whatever it is so there is actually demand for capital in the particular way that yeah you got me that yeah that that is my working thesis of what he's trying to do m and and so I'm going to give him the benefit of the doubt I'm going to be a believer in Ryan Cohen I know that's going to make the GameStop haters really mad and that's fine I you know you can not like Ryan Cohen between that and it doesn't matter to me you're not going to hurt my feelings but uh I I want to see a positive outcome for everybody I'm not talking mo ass I'm just talking like how do we get a multiple higher than a $20 price yeah how do we get it to 40 bucks you know where you can justify it that that's really all I'm trying to figure out do we miss any questions I'm looking through here let's see did Ryan used to hold earnings calls when he was you know I don't know because Chewy was outside of the area that I looked at um I looked at some of the financial statements a long time ago for chewy but otherwise not so much I think Chewy now does do an earnings call if I remember correctly because I feel like I've listened to one but it's a really good question gamer oh wait is it gamer with ESP that's amazing I love your tagline names um let's see what are some of the are there any questions that you're one stop print shop says what if they bought Hasbro to acquire DND D and Magic the Gathering I don't know much about Hasbro so Hasbro you know Hasbro is doing its own transition as well I'd have to really look at that's a good question let me I you know what I'm going to do is I C Hasbro is in the S&P 500 so next time I listen to earnings call in the next quarter I'll kind of try to imagine what it might look like with GameStop it's a really good question though because they also have to massively transition their business they do actually um have a pretty heavy or are attempting to desperately what however you want to call it they are winding down the core business and trying to like do licensing of the gaming so they make a lot off of the Monopoly game um that they've licensed out to I can't remember which gaming company they did they licensed it too don't worry you guys probably all know in the background um so it's it's not the craziest thing what corx says they should they should get more into physical gaming like D and D books trading cards they're they're now in trading cards corx I don't know if you knew gaming events I know at least one person corx who is very against that idea just because you brought it up but but I mean if you're gonna go into trading cards why not why not just take uh three feet of aisle space and dedicate it to to physical gaming books I mean what what is so bad about that they're they're taking the gaming card industry on headon I I don't know if that physical gaming the you know the inventory you're talking about is a growing business though and there is a big push on to grow the trading card business which is probably what GameStop's trying to Hitch their wagon onto before it's too late unfortunately uh you know most I've talked to business owners both web store-based and brick and mortar in the trading card business and they said Tony it's it's way more Cutthroat than you can imagine the the profits aren't as fat as you can imagine or you would imagine and you get stuck holding a bunch of inventory if you don't have the right inventory it can plummet in value right out from under you because if you don't have the right cards at the right time you just get stuck holding state declining price inventory so maybe GameStop circumvented that by you know only holding the amazing cards the eight nine and 10 rated cards I don't know you don't know what hard cards they're holding yeah it's all online um it's all online may you can go look at their inventory you know when you um when you said that my mind went immediately to renars for some reason and like live events I think that live events you know it's interesting because one time I looked at what conference businesses sold at relative to what they cost and the conference business which obviously sounds like it has nothing to do with something like a renair but in fact actually it quite does because you're sell because essentially the business is just selling tickets and then people attending and then you doing the marketing for the for the business but the multiples that those things go out are actually pretty good and the profitability uh depending on how you're sourcing the Loc can be out of control good as well um so that's not I don't know if it was like gaming conferences or things like that you know it's it's not a bad call if if that is a direction he wanted to go in or if he wanted to buy a company that does that also not a bad call I talked to uh some GameStop employees you probably don't need four billion dollar for that I talked to some GameStop employees who tell me that uh GameStop plans on having a a bigger presence at some of the trading card conventions did you know they have Trading Card conventions may I want to go that's so cool yeah there's a big one out in California in fact they just had one uh I think from the Burbank card shop they put it on yeah but uh you know it' be interesting to see I I I like you know just like AMC's getting into the the merch and popcorn I like that gam stops getting into trading cards and and trying new things and that to me May you know isn't that wouldn't that be an indicator that they're not trying to wind down the business if they're exploring new business models like trading cards I mean it depends what they're doing exactly with it you know what I mean that like I don't know how much money that business needs but that capex was really low yeah I I I ran the numbers of how much they need to maintain that inventory it's it's minuscule yeah but how much how much money do you need to buy 4,000 cards yeah not a lot so I mean if they're it's not really a huge investment it's not even really a huge Money Maker yeah I mean so GameStop has its brand GameStop has its clients and customers that you could figure out another way to re sell something to them um I mean if you told me that they were gonna buy the trading card conference I might be like oh that's really cool there you go then that would be that would be um a little bit of a different Spin and if he if he wanted wanted to buy things like that I actually would be pretty positive on it yeah you think actually there's more extension ability like I do think the idea and I've heard a couple of different companies talk about it but not always like first and foremost but the idea of extending the virtual world into the real world um I don't think people have figured out how they want to do that yet so if he did something like that I would be thrilled I don't think that takes four and a half billion dollars so I think that's now from hearing the conference the guy that puts on the conference talk he doesn't make any money doing it it is for publicity for him he get marketing enough okay so so maybe that yeah I don't know there are some conferences where people do really well like people pay up it takes a while to get enough people and you have to like make sure that you have like someone there that everybody's gonna come to see but some conference businesses can be quite profitable Treetop says what if GameStop just keeps diluting until they have enough money to buy gaming company oh my gosh companies aren really for sale so much I mean maybe like which one you mean the the thing is I mean how how long are shareholders going to tolerate that that's really the question there's going to be the hardcore part of them that's oh yeah bring it we we love dilution I hear them say it every day on YouTube I bring me raise more money on me Ryan sell more shares I beg you sell all billion shares and then I see a lot of people getting really pissed even about 20 million like if roaring Kitty get goes on another tweet storm and you have a you have a 200 million volume day 20 million isn't going to even be noticed they'll sell through that at a premium uh in a heartbeat it's not even going to phase the price I wouldn't think yeah I mean I like I said I don't know why people are so mad about 20 million shares other than it just seems egregious because they haven't communicated anything and they already have 4 billion so why do you need another half a billion okay so that lends itself to what I was saying like if they're deciding to become um uh a publicly funded private Equity company then that's amazing no no no no no don't you dare call Ryan Cohen a private Equity company private Equity is evil remember okay uh uh what do you we call it let's call them a venture Venture Capital sorry Venture company Venture company yeah let's let's use Venture Capital so nobody gets their feelings hurt sorry if he wants to be a publicly funded Venture company that's like the stuff of dreams that capital is permanent so it's great so okay so like maybe I could Define permanent Capital as a word because sometimes it comes up and I see like these half definitions so the other forms of capital um you have to pay back that's all the debt side that's what AMC is experiencing Joy right and then there's like um if you're if you're in Money Management there's just raising assets like like a black rock raises assets they go and they ask for money and then you tell them you're going to give them x amount of money but that money is not black rocks they can all like literally get up and walk out the door tomorrow if they want to the dream the holy grail for all asset managers is permanent capital and in fact before like 2000 well I mean some of them went public before the 1990s most asset managers were not public companies because they were like wait a second hold on this is partner owned we don't want to share our business but then because of various things that happened almost all of them came public Goldman Sachs in 1999 came public and that was a big deal because now you had permanent Capital um and subsequently all of the big private Equity companies have slowly but surely become public companies so that they could have a core base of capital that they never have to give back and they don't have to pay interest on so if if he wants to dilute another 20 million because the he has this beautiful asset which is gamestock the stock which every now and then just like shoots up like crazy in price therefore not just raising Capital but raising Capital off of doesn't even don't even worry about the valuation then he should do it he should always have a shelf available and that shelf should always be as large as he thinks would make sense for the Vol for the average daily volume yeah um that that's just brilliant that's brilliant yeah I was looking back at the last few spikes they were like 180 to 200 million shares in a day and I was like 20 million makes sense because that's 10% yeah of a spiky day and that would go unnoticed it wouldn't piss people off but it throws a ton of money extra in GameStop's Bank you know maybe another 6800 million even even Goldman Sachs should be envious okay even Black Rock black Ken Griffith should be should be envious at that point okay no no like okay like it's a really big deal that the stock does that and then he's able to capitalize it not like May uh have you looked into or thought about at all like that $3 billion they raised in May and June there's a a raging debate in the community who bought those shares uh we we got the we got the filings the 13fs and didn't really see any institutions uh you know drastically increase their share count not you know not to soak up 120 million shares so they're a lot of short sellers just do you think it was shorts covering or do you think uh it was all retail do you have any thoughts just probably shorts covering I would think I don't know I don't have strong Fe I don't have strong thoughts on it because the mechanism of these squeezes is so crazy but I would suspect that if you um like if you were short it squeezes you got t plus three like like maybe that would be how you did it not sure and and if that was the case I just want to say I I don't ever think that these guys are selling shares to help the shorts they're just taking advantage of Mana from Heaven the the price is trading at 5x God value when when you got no income take the money four billion dollars like I really wish that I think you know the the drama between the short Sellers and the moas folks I am there for it to like listen to it a little bit but for me it is almost religious the way that man you know I mean like like in in a million years you have to think about all the people in New York that work in the marketing section of an asset manager and toil away conference after conference begging people for four billion dollar like like it's so it's beautiful it's actually beautiful yeah and Ryan just raises oh two billion in a day yeah that was easy beautiful you know he didn't even have to like okay another little thing I'll just say what he's paying Jeff to file this shelf is nothing compared to if he had to go do a road show and actually beg for the money from all these institutions it's like it's amazing it's like so much cheaper like okay those of you still learning Goldman Sachs is gon to report okay and everybody's so focused on the trading Revenue but it's going to come through the the banking Revenue okay just look at that banking revenue and realize that Ryan just Sid sidest stepped it he's not part of that b he's gonna his Revenue will actually be in the trading Revenue section it's like like so small relative to what the bankers would gou you for if you were to do it a different there is it's like is is is beautiful it's actually Beautiful s sufan suon say he has a question go ahead sufan what you got I'm waiting for him to type uh see what Matt says there's already been a lot of gaming Studios that have closed down he's he's commenting on Jim and I agree with that Jim there gaming companies are kind of like nightclubs right they're they're popular for a while and then they stumble tough they have too many projects going and they just kind of implode it's a really tough business and then the tech changes and upgrade so fast these day being organic oh boy sufan he's like we need you to talk about AMC's oh boy um they're different it'd be like would you choose um an LV bag or would you choose um you know a Tesla be like grap jelly or strawberry jam I want them both at a really really good price because I'm I'm cheap about it all right so so so that's what I like about you may you're cheap exactly you know my with my LV back right like so I like a good discount what can I say I'm I'm still a value investor at heart you know suie I know that doesn't give you much but just nice nice step may try again sufan he's trying to stir up some trouble I just manage your size on these because they will be volatile you know do I do I think that the Shelf is there because Ryan thinks there might be another moas and just wants to have that as an option he could potentially never do anything with the Shelf yeah that is an actual truism but given the history of these meme stocks every every company that has had that situation should have a Shelf sitting always always ready always y yeah for and then they should monitor volume spikes and really do that calculation on the regular because may maybe you can help me you know I know the process but I don't know the timing uh if if they had I mean they have a perspectus now for 20 million they had the Shelf if if GameStop were to if they didn't do the prospectus yesterday and GameStop were to start running up to $50 tomorrow morning how long would it take them to get the prospectus done do you know if they they have a shelf yeah but they they still need to notify shareholders hey we're going to intend to sell 20 or 50 or 100 million shares under this shelf you got to have a prospectus right yeah didn't that happen to AMC though in this last meme run they had to refile a no it happened to happened to GameStop they they got their prospectus out after it was already coming down the first time that's the second time they were ready yeah I think it does take a at least I don't know the answer I I don't know the answer I'm sorry all right that's fine I just I was curious I'm guessing based on GameStops and reaction it takes a couple days well I know you have to file it I think it's probably more filing the bankers will have it ready like in two seconds they have people that don't get to sleep at night yeah I was thinking like you're you're you're working overnight that up exactly so it's it's whatever the filing situation is all right fair enough guys any other questions because I don't want to keep May here all night and I want y'all to go watch my GameStop video before it gets too late the one that I uploaded at at 7:30 and I haven't eaten yet today since 11 o'clock I had a ribeye at 11 but it's uh nine o'clock here now so I'm starting to get hungry all right final questions we got uh two minutes May two minutes for final questions you got any on your end that I can't see I'm just scrolling down like crazy let's see well angry people soft bank has a PE of okay guys some of these are little but like um a lot of people just asking kind of what valuations you would get on the if it was a if it turned into a financial company it's really hard to say guys because it would be young and it would depend on some sort of proven like like you you need the first few deals to come out before you get a real pop in valuation games have so much Cas why did the price drop I'm I'm gonna say to you Marco I just put out a video answering that very question uh going over GameStops Q2 earnings and you want to go to the end of that video and watch the part of the video where I talk about how to Value the price of a stock there's multiple layers here going on with GameStop they had a 30% reduction in Revenue falling revenue is not going to be looked at at favorably we know they're cutting stores right so we expect Revenue to fall but you can't call this a turnaround story I don't care what metrics are getting better oh the the inventory turnaround improved who the cares you're in a declining business and that is just not going to be favorable so declining Revenue um not operationally profitable and cash on the balance sheet earning four or five percent is not really worth someone paying 2x that cash I could take my same investment and go buy treasuries for the same return risk-free so and then on top of all of that they announce dilution so there's multiple things I'm not not criticizing GameStop I'm just trying to help y'all understand why the price is falling and that was that video that I just put out there's a lot of people that are narrowly trying to focus you guys on look at all this cash on the balance sheet my opinion is Cash on the balance sheet is irrelevant unless the market cap is under the book value then it becomes more interesting otherwise Book value doesn't really matter earnings matters income matters and that even with making $14 million that's not worth a $23 price 14 million on a quarter you could do that four times and it'd be a $12 stock this is a pure play Ryan Cohen story right now the whole Gamble the price is a gamble on Ryan doing something with the money money sitting there is useless to all of us yeah it's useless to a $23 price it's certainly not worth a 30 or $40 price until he does something with it the day that news drops if you were betting on Ryan Cohen you could you could be happy you could be happy or people could freak out first be very confused and then maybe happiness comes after yeah or you could be disappointed we just don't know what he's going to do we don't know that's why I can't tell you what a a reasonable if you know I can't tell you if GameStops a great investment it's a it's a reasonable gamble if you're a Speculator and if you're willing you say all right I got this money and whatever happens I don't care yeah I'm just I'm so tired of it hurts my feelings to hear people say I I put $100,000 into this company and I just lost 80% of it you knew it was a speculative Play Why did you put all of your life savings in it like just understand the risk and if you say got it Tony GameStop speculative I could lose half of it or I could double my money I'm good with that whatever I spent I'm good with it and I won't blame anyone I made the choice then do whatever you want yeah I you know I wish that they would on some of these stocks how a little disclosure this is not a massive amount of my wealth or I'm prepared to lose every cent of this um I don't think that you know the company's not in debt or anything like that so I don't yeah there's no bankruptcy thesis with GameStop so you could technically just be like all right 4.5 billion in cash market cap is n billion the core business is probably worth something more than that so five and a half billion like you know like you could do something like that and your guess is as good as mine because I think that's how the analysts are doing it now I mean they got a they got a upgraded not upgraded but a updated price Target from wed Bush today of $10 and that's right at book I think that's low $10 is low i' I'd give I'd give it a little more than that but just strictly on traditional financial analysis because analysts aren't betting on Ryan Cohen guys they're looking at ratios they're doing calculations They Don't Care About You Believe in Ryan Cohen so don't get mad at them they were they were trained a certain way to do something and that's a traditional way to do it sufian thinks they're going bankrupt in the midterm how though they don't have any debt I was watching black hudge and he sufan says I would debate you that organically GameStop's going bankrupt impossible sufan they have four billion dollar yeah and I mean they could close all of their locations sufan and just make two 150 million a year off of just off of Interest off the interest there's no bankruptcy yeah this doesn't have bankruptcy risk I'm I'm not sure um you know I'm not sure why that that that one probably there may be some rumors that maybe some people that are really focused on that that shouldn't be a focus at all this thing I I got to be careful debating Sufi because he is the CPA and I'm not but tell us some more sufan yeah tell us I think the Flor should be at least the cash which I think is what other folks yeah I mean your bottom seems like your safe price you should be able to get out at least for 10 bucks yeah so for me the thing that would make that a little bit hard to be like I'm with you suon is that the they're still buying new inventory which tells you that there is some actual sales happening so so it's not like it's it's not like oh this inventory is being sold at a massive discount life sucks the world sucks right like no their margins are improving yeah so so it's hard for me to be like I totally see what you're seeing this thing as an issue because all of the ad so if we go back to the balance sheet um the way that I think about it maybe this is not the right way to think about it maybe this is not how others think about it is that um a lot of times people always focus on who's in line here but I also like to think about it if you're concern is bankruptcy what can you get rid of here in order right so cash obviously you'd have to burn through all of that and then you still have you know the inventory which is 560 million um you know and then so on and so forth you have no issue between current assets and current liabilities um and you're like that's it the 1.5 right so even current assets could take care of the 1.15 that's how I think of balance sheet is I think of the asset liquid along with the liability liquidity I've noticed that a lot of times when people are focused on this they only look at the liability liquidity and they're like you're in line this way and I'm like no the next thing that has to happen strategically is you start running down and you either have so like for something like AMC you're going to have to go since the current assets are less than the current liabilities or have been this quarter probably will get lucky not you know especially with all the things that have happened but what bankruptcy doesn't mean total liquidation however what if they burn all their Cash 5 to 10 years from now and oh 5 to 10 years were you know maybe another story but I don't think Ryan Cohen's goingon to do nothing for five years they won't have as many stores in five years and and so if you know even if you're optimizing so let's take you let's say you take an L on every single store um what do you have left at this point I mean your revenues were down by 30% but you somehow still ended up profitable which is not even the case in the past and then you your inventories are down 18% % which I am reading if your revenues are down 30% that that you got rid of a lot of stores is really what it is you know so so I mean I suian you you know I you've been looking at this for a lot longer so I don't want to you know go in a weird Direction with it but I would say that if if it turns out that the amount of stories he got rid of was was really really small um but we see like this massive drop in revenue and not and this weird drop in inventory then all day long I think you've got a really strong argument but if if the amount of stores he If instead it looks more like the way that we've been talking about it which is you have this really big Exodus of stores that's greater than 20 let's call it then I think it it makes it really hard for the company to go back I mean even in their worst year in 2021 just looking back at recent history the uh the net loss for the year was $381 Million it'd still take them 10 years to lose four billion dollar it's a lot of dollars I just don't see it Sufi and I'm sure no one that's in GameStop or maybe only one person is planning on owning GameStop 10 years from now so but something's going to happen long before that I think uh Robert says could GameStop offer dividends to shareholders I'm curious to hear May uh thoughts but I talked about it on my video that I just posted two hours ago and my answer was could they issue a dividend sure but to me just stepping back not being a a person to tell you I want a dividend to cause a short squeeze because I don't really believe in that I just look at it like dividends should be paid from excess earnings GameStop's raising cash dividend would be spending cash and so the two don't line up to me like why would you raise cash just to return value to shareholders and what value are you returning when you don't have excess earnings it doesn't make sense to me unless you're just trying to Pander to retail he doesn't really seem interested in pandering to retail because he's diluting them so I say no no I don't expect a dividend but it is possible and may over to you I also say no and I agree with everything that you're saying and I would add the following you don't want him to return the cash your cash hang like hanging out in GameStop is worth 2x if he returns the cash to you it's worth 1X right yeah let's make that clear like the cash right now is the let's just call it the book value your cash when games stops holding it is only worth $10 a share but your share price right now is 20 yeah that's what May's saying your cash is worth 2x just sitting there at GameStop if he paid it back to you he's depleting the cash of the company that you're you're currently enjoying a 2X you know valuation on that's what makes what he's doing on these moases magical it's like magical we I I want to encourage you guys to get out of this mindset the a dividend is necessary to squeeze the shorts what's going to squeeze the shorts if there's any remaining after he raises four five6 billion dollar is what's going to get rid of them is the same thing that's going to get rid of them at C earnings doing something with the money I can't wait to see what he does to be fair like there's a part of me first of all I very clearly if it's not clear I have nothing but respect for anyone who can raise Capital this way and number two like I'm so curious he's a smart guy right like he exited his business like a champ so I'm so curious what he comes up with really yeah and corx says uh yeah think of it as like a growth company right growth companies don't typically pay pay dividends because they need to keep that cash and invest it in the business to provide you a future greater return and that's ostensibly theoretically hopefully what Ryan is doing he's accumulating all this cash to do something beautiful for you to transform it through an acquisition or an investment and so just handing it back to you when he just got it from you to me doesn't make logical Finance sense I get it from retail Trader mindset but I want to encourage you guys to step out of that and try and think like a a finance guy yeah I mean there okay so this um the argument for dividend is that Brokers are not holding accurate okay so let's talk about like why someone would do it if they were purely just trying to create the short squeeze depending on how he's trying to do it oh did I lose you what did I do so so if you you could technically just create a dividend some kind of cash burn um if you were only trying to squeeze the stock I don't know how big the dividend would have to be to make it really ugly um but it it is a legit way if he's gonna do that I would suggest he does a special dividend so it's not a quarter and since he's got the Shelf offering you know it's not the worst idea if you were to say okay so so I will give some fairness to that so let's say let's say he's got this team of people and what they've really decided is that they're really great at raising capital and magically adding a multiple to it not insignificant okay and he and he just like hired literally a team of people to constantly squeeze the shorts then he I mean I think Market mechanics is not my thing but I think technically he could issue a special dividend and force the shorts out because they would have to pay it but M here's the thing May the the people that are really Advocates of this dividend Theory don't think that the short interest is 10% they think that the reported short interest is incorrect it's a lie it's not really being reported correctly and that the short interest is 100x multiple of the reported short interest so therefore whatever dividend he does whether it's a warrant or 10 cents or 50 cents it's going to flush out all of these hidden naked shorts yeah that's the theory I mean there's definitely derivative instruments on gamestock you know but what you could do so like if I was like I'm gonna entertain this all the way to the bitter very end it's not like this is not a zero thought I will say that like you know but if you were G to do it you'd want a little bit more evidence that it was necessarily going to create a moas and then you would you would basically sell every single chair in that shelf if you could but you'd have to you'd need like very high short interest to happen um and then if you then issued a special and then at the same time toss the shell then that would be you know how clever that would be that would be so amazingly clever because basically you would be um paying out the dividend but then taking in the mo ass money then all day long he should just do that's one thing they're saying like that's what they're saying he's raised all this money he could return it to us in the form of a dividend and cause the moas and sell more shares I mean I get it it would be genius if it worked you just you gota if it doesn't work then it's just a reduction in capital and it sucks so I think you would really need so you've got at least at least the chessboard is set up correctly right so the you know the chessboard is set up where you have the Shelf offering very nice you know you've got plenty of capital so it won't even bother your operation whatever it is you have actually planned um and then again preference personal preference special not like a quarterly dividend okay do a why why special so that it's only a one-time thing and so then it keeps like the shorts a little guessing as um but it would affect the entire options chain if it's a large enough if it's a large enough dividend but you really really really really really like you even though there's all these feelings that people have it can't be a feeling at that point you really have to see the short interest go past a certain point to feel confident that you could squeeze them like hardcore I think how it works there may if if it happened I'd just you know pop a cold one sit back that day and watch what happens but I'm not ever gonna be a channel that's set you know p in the table like oh Ryan's planning a warrant he's planning a warrant distribution to shareholders to to squeeze the shorts or he's planning a dividend that's not like the thesis of my channel if it happens if it happens cool like we'll just see what happens I I don't care if he does it or not it's kind of like it's kind of like betting on zer0 you know some people who play like roulette they're like you know what we're just going to put one chip on z0 just in case it's like that that's what it is I I'll have a few shares just in case but you know I'm not going to be the channel pounding the table that oh if he just he just needs to do a dividend there's plenty of other people pushing that and yeah I'm just gonna I'm just gonna tell you the logical reason why he's probably not going to but if he does it don't matter to me don't matter to me at all yeah it'd be interesting to see maybe we'll finally put this great dividend Theory to to bed once and for all remember remember when the the three for one or four for one stock split was supposed to cause a squeeze too and all the price did was plummet if you pay a dividend that you know and it doesn't work the price is going to go down you know that down you guys know that right when he pays a dividend that's going to reduce the price yeah that's why the only way that it becomes intriguing would would oh it's Sparky hey would that be considered manipulation to issue a dividend just the stocks spice then have the shares I don't know the answer to that Sparky be but because you know there's nothing that would be illegal in doing that that's like nothing is like not because like if you already have the shell filed at some random date in the past where like you know it had where and you have a use of proceeds that doesn't involve the words I'm just the here for the shorts you know I mean and then you then you so the Shelf is just hanging out the broker has their instructions at a time that H you know that has nothing to do with your dividend at all you know it's okay it's okay Sparky it's not naive it's a real it's it's a great question because then anyone with with you know it's I don't know how you would I I don't know how you would really pursue it if you're first of all you're a short seller which the SEC doesn't really help the short sellers except in the the weird mechanics of how the market currently exists so I I don't know if even as a short seller you could sue the company you know like so so then who would you go to that's a legal question not just the company needs to not say we're doing this to squeeze Assurance they're just like hey we got4 billion do we want to return some of that money because we're so benevolent and here's here's a dollar a share he that yeah totally right okay so like that may may what if the $20 million what if the 20 million shares is to raise 465 million bucks so they could issue a $1 special dividend I mean what if I mean well it's not in it's not in the document right so that so so there would be nothing you know but but technically I don't think I don't think it's impossible and I I think it would be fascinating if it happens to watch it happen I think I'll be giggling the entire time because I probably can't help myself at that point but like like you know because it would happen at different times and you this in this in such a case it would be the case that you you gave like I don't know what let's say they did a dividend and it cost them like $10 million but if the stock if if it's enough no I'm saying it cost them let what if they did a $1 per share dividend so it cost them 485 million okay but then if the stock like doubles or something you clearly raised more than that so it would be the one time that that is a that is that that the the value of the company doesn't go down because the dividend yeah yeah I mean if any stock could do that it would be GameStop yeah even even if there were no shorts I mean just the the thought or you know 10% short still you could have a a nice little run up I mean I don't know I I want to see him do it and test it and then let's do it all right let's do it you guys convince you guys now for the first time the Moos people I am completely let's do it compl and I'm sold because I just need to watch the mechanics on this I just want to watch the mechanics right like I need to understand these Mechanics for myself thank you thank you guys I love you guys Evan says uh uh Larry changen had a good tweet this week what other CEO is taking no pay no doc uh no no stock yeah I mean Ryan Ryan is essentially working for free other than the the very cheap shares that he has he's he's got a very good capital appreciation on those uh yeah I I don't know many i' I've spent maybe five minutes looking to see how many other CEOs are working completely for free it's a very short list it might only be one person and that that is another reason why I'm going to give Ryan Cohen the benefit of the doubt even though the some some people hate him I'm not one of those guys yeah yeah gosh you guys you know what sold on this dividend now I am now Pro dividend Pro dividend sorry new caveat you'll make another video you every all of us need to try more on content it's fine I I'm just I'm gonna say it would I'd be fine with trying it but I'm not going to go on the record saying that I expect them to do it is that fair I think that's fair I don't know how management thinks versus like how all of us that just want to see it done to think I understand why everybody wants it done and I I'm right there with you but like if I'm sitting in the boardroom I'm probably like no we're not we're not spinning 400 million on a dividend I want to see it's so bad though I think it' be so cool sorry I think it's amazing it's an amazing concept Sparky wants to see it I know let's do it Sparky everybody write a letter yeah Larry Larry win dividend I wonder how big the dividend I mean like if you could really raise that much because the squeezes are almost a double right so like or in some cases even more than that like it would actually be worthwhile to have a team to like really calculate exactly what that dividend would have to be like so the least amount of capital to deploy to sque to create this but you really have to have this extreme certainty that the shorts would be forced like you know the and then you've got to sustain it for a few days right so you you're probably going to have to a little bit of capital to like so you do Dividend plus stock buyback to force a certain type of behavior already um and a dividend plus a stock buyback would not in and of itself in and of itself it would not be manipulative from the company's perspective because plenty of companies do both a buyback and stock you know so as long as those things are like separated from each other you just need to Ryan keep your mouth shut don't talk about short squeezes none of that executing off a program so it's not even like you can do you know what I mean just say you're returning shareholder value you know we we want to honor our longtime investors pass you know we've thought about it what we needed the capital for is no longer we're going to return it right back to shareholders you know what there's no like I'm not a lawyer and I would really like to talk to one if you are one write it in you know what I mean but I mean the downside is limited May if they paid out a dollar special dividend the stock price goes down a dollars there's a limited downside they've got four billion in cash if they raise another 450 to do it yeah let's try it let's do it I'm on board let's do it all right the dividend gamestock people you've won me over you have won me over thank you uh Sparky says tomorrow on a variety of YouTube channels Tony dinaro says GameStop to issue $5 dividend no no no oh my gosh we got some people I'll connect my legal team it's amazing you guys are amazing all right uh my wife just got home from yoga and I need to eat and what time I think I said at N I think I said at nine o'clock we were ending and announced 9:24 we started late it's okay no I I love these chats I think we covered some good theory that you have about the what was it the uh uh reverse merger Theory I'm I'm gonna read up on that because I'm I'm no expert on reverse mergers I know you are me because you you spotted something that none of us were talking about we don't know if that's going to happen or not but it's just like one more thing to to add into the bag of the grab bag what's GNA happen with all this money what's Ryan setting this company up for there's a lot of potential outcomes thank you for adding one more Bean into the grab bag I'm so I can't wait to see what he does it's really interesting I'm going to close by saying uh again if you're just joining in I don't hate GameStop anybody who's telling you that it's because they don't want you to watch my channel because I just provide financial analysis without without all the hopium and they don't like that I bought GameStop today at 1950 so my basis is 1950 that is definitely not a bu recommendation for you because I see some potential downside depending on what happens with the the PPI and the FED meeting and uh so if it if it goes lower I'd prefer to buy there but I did pick up a little bit today so that's where I'm at um I have nothing and the vast majority of my portfolio is Blue Chips like 90% I have a little I keep my risk managed my mem stock gambling speculative money is not my portfolio it's a portion and I encourage you guys to learn some risk management after the moas of course exactly after the moas guys all right we'll call it thank you guys have a good night we love you may thank you for your time Sparky nice of you to stop in corx same to you Anya if you're still here over on Ma Channel thank you everybody in the chat we love you have a good night let me find the outro here yeah okay all right here we go let's go yo I'm like an addict do I got to have it I ain't even playing got a really bad habit If It Moves got to grab it fuse like a magnet lose won't have it till I'm doomed in a casket I ain't playing got a weird mind if you work eight hours I'mma work nine if the tastes sour you should taste mine I'mma stay in power for a long time get up now I ain't a quitter toss me the ball I'm a really big hitter big picture I'm a straight ring the song to the highest B Got Juice got gas I'mma move fast new shoes new tracks like who's that I'm new come back better than last year so new me never going to look back I'm never going to look back cuz damn I was bu to last you move slow when I move fast and that's fact only I can make a change slowly