GameStop (GME) Stock Climbs as Cohen Won’t Take No for an Answer

TLDR

• GameStop (GME) stock rose 1.4% in pre-market trading to $22.07 after the company filed a regulatory update reaffirming its plan to keep pursuing eBay (EBAY).
• GameStop projects adjusted EBITDA above $600 million for fiscal 2026, nearly double the $345 million reported in fiscal 2025.
• CEO Ryan Cohen withdrew a controversial performance pay package worth up to $35 billion in theoretical upside, removing a distraction from the eBay pursuit.
• GameStop now holds economic exposure to roughly 9.8% of eBay through direct shares and put/call positions.
• GME trades at a forward EV/EBITDA multiple of about 9.6x, below the retail sector average of 10.1x.

GameStop stock climbed 1.4% in pre-market trading on Tuesday, reaching $22.07. The move came after the company filed paperwork confirming it still wants to buy eBay, even though eBay already said no once.

GameStop Corp., GME

This isn’t a new fight. GameStop made an unsolicited offer worth about $56 billion in cash and stock, working out to roughly $125 per eBay share. eBay’s board rejected it, calling the proposal “neither credible nor attractive” and raising concerns about financing and leverage.

Rather than walking away, GameStop appears to be doubling down. The company says it plans to release more materials explaining the strategic logic behind the deal, though it hasn’t given a timeline.

Cohen Clears the Decks

One of the more interesting moves this week wasn’t about eBay directly. CEO Ryan Cohen withdrew a planned shareholder vote on his own performance pay package, which had been scheduled for the July 7 annual meeting.

The package involved 171.5 million stock options with a ten-year term, structured across nine tranches tied to market cap and EBITDA milestones. If GameStop hit every target, Cohen’s theoretical payout could have approached $35 billion.

The problem was optics. If the eBay deal went through, critics could argue Cohen would unlock a chunk of that reward simply by completing the acquisition, since a combined company would push GameStop closer to the required market cap and EBITDA thresholds. Pulling the proposal removes that conflict of interest narrative before it could complicate the bigger fight.

Alongside the filing, GameStop raised its outlook. The company now expects adjusted EBITDA above $600 million for fiscal 2026, compared with $345.4 million in fiscal 2025. That’s a substantial jump, and GameStop tied the guidance directly to its continued push for eBay.

The fundamentals back up some of this confidence. GameStop posted its best quarterly net income ever in its most recent quarter, at $389.6 million, plus record first-quarter operating income of $143.3 million. Net sales grew 14% year-over-year, driven largely by collectibles.

It’s worth noting that a big piece of that net income, $268.4 million, came from an unrealized gain on a derivative tied to eBay stock. Strip that out, and adjusted net income still came in solid at $179.3 million.

A Stake That Keeps Growing

GameStop isn’t just talking about eBay from the outside. The company holds 4.3 million eBay shares directly and has additional economic exposure to 39.05 million shares through put/call pairs, adding up to about 9.8% of eBay.

After a regulatory condition cleared in early June, those positions became eligible for physical settlement. GameStop still doesn’t have voting rights over those shares unless that settlement happens, but the stake gives Cohen leverage either way.

On valuation, GME now trades at a forward EV/EBITDA multiple of roughly 9.6x based on the new guidance. That’s actually below the retail sector average of 10.1x, a shift from the stock’s long history of trading well above fundamentals during its meme-stock years.

The stock remains closer to its 52-week low of $19.93 than its high of $28.10. The broader market gave GameStop no help today either, with the S&P 500, Dow, and Nasdaq all trading slightly lower.

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