GameStop CEO on 'staplegate' auction: If we get to seven figures I'll sign and deliver my underwear
By CNBC Television
Key Concepts:
- Charity auction
- GameStop business transformation
- Cost control and profitability
- Diversification into trading cards and collectibles
- Bitcoin investment as a hedge against inflation
- Capital allocation strategy
Auction of Damaged Nintendo Switch and Stapler:
The GameStop CEO, Ryan Cohen, is participating in a charity auction involving a stapler and a refurbished Nintendo Switch. The items originated from a Staten Island store where a store manager stapled the switch on launch day. The auction is currently at $250,000. Cohen humorously offered to include his underwear if the bid reaches seven figures. If the bid hits seven figures, he will personally deliver the underwear to the winner in Miami, and take them to McDonald's.
Cohen's Underwear:
The interviewer jokingly asked about the type of underwear, to which Cohen replied that the winner will find out. He also agreed to sign the underwear.
GameStop's Business Transformation:
Cohen discussed the current state of GameStop, stating that it's a "much more profitable business, smaller business, less stores, very strong balance sheet."
- The company has focused on cost control.
- The business model has shifted away from a primary reliance on hardware and software sales.
- There is now a significant focus on trading cards and collectibles.
Crypto Investment:
GameStop has invested "just over $500 million into Bitcoin." Cohen views this investment as "a hedge against inflation and global money printing."
Capital Allocation Strategy:
Cohen stated that GameStop has "over $9 billion of cash and marketable securities." The company intends to "deploy that capital responsibly" and only look for opportunities "where the downside is limited." Cohen emphasized that he would treat the company's capital as his own when making investment decisions.
Perspective on GameStop's Investment Profile:
Cohen rejected the idea that GameStop should be viewed as a portfolio of assets or a "mini micro strategy." He emphasized that the company has "our own unique strategy."
Synthesis/Conclusion:
The interview highlighted GameStop's ongoing transformation under Ryan Cohen's leadership. The company is focusing on profitability through cost control and diversifying its revenue streams, including entry into the collectibles market and investment in Bitcoin. The company plans to strategically deploy its large cash reserves. The auction is a charity event and the stapler is an item from their store.
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