Video game retailer GameStop has released a positive Q4 financial report, shocking many short-sellers as its shares skyrocketed. The company’s stocks had been on almost a free fall over the past few months, but the trend seems to be reversing now.
GME shorters in for a rude shock
GameStop managed to stay afloat and turn a profit $48.2 M in Q4 2022 after successively making losses in all quarters since 2021. The report set the market ablaze, with GME stocks rising by almost 50% at one point. As the euphoria behind the company’s stock continues growing, more shorters are at risk of being squeezed out of the markets.
In the financial report announcement, the company said that its hardware and accessories category had a net profit of $1.24B, a 4.6% rise, while its software sales fell 15% to 670.4M. It also stated that its collectibles category slingshot by 12% to 313.2M. The company reported 16 cents per share, a huge difference from the reported 49 cents per share loss a year earlier
Global Markets continue receding
The ongoing financial crisis is becoming a worrying issue lately, with banks collapsing globally and inflation spiking. Recently, major banks like SVB, Credit Suisse, Silvergate, and Signature banks were forced to close down due to bank runs and non-compliance with banking regulations.
Ironically, investigators and auditors have discovered over 200 more banks may have the same loopholes in their balance sheets as the Silicon Valley Bank. These developments have sparked debates on Socials, with people exchanging views on who is to blame for what’s happening.
President Joe Biden has come out to say that Venture Capitalists and Bank investors are to blame for the mismanagement that is going on. Therefore, they will not be bailed out if case banks do not perform according to their plans
Investors in the banks will not be protected.
They knowingly took a risk, and when risks don’t pay off, investors lose their money.
That’s how capitalism works.
— President Biden (@POTUS) March 13, 2023
He has also ‘assured’ US Citizens that the banking system is strong and safe, a comment that not so many people agree with. Some Twitter users criticized the FDIC and current efforts to ‘save’ the banking system.
We need a system that doesn't incentivize risky behavior. Banks currently have a "free roll of the dice" mentality, where the rewards are great when everything works out, but when things fall apart, it's the shareholders or depositors who bear the brunt of the losses. The bank…
— Jeff Hwun Yee Chen (@jfchen1) March 15, 2023
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