GameStop experienced a significant drop in its stock value, falling over 4% on Wednesday, after failing to meet analyst expectations for the third quarter of 2025. This downturn was primarily attributed to declining core sales and reduced gains from its Bitcoin holdings.
The company reported third-quarter revenue of $821 million, which fell short of the $987.29 million anticipated by analysts, according to Seeking Alpha.
GameStop's Q3 report also disclosed its Bitcoin holdings, which stood at 4,710 BTC. During the quarter, the company incurred unrealized losses totaling $9 million on its Bitcoin position, although its overall BTC holdings remain up $19.4 million for the year.
This marks the second consecutive quarter where GameStop missed analyst expectations. In the first quarter, the company posted revenue of approximately $732 million, below the $754 million estimate.
Despite adopting a Bitcoin treasury strategy in March, GameStop has continued to face financial challenges. The initial announcement of this strategy had briefly boosted the stock by about 12% to $35 per share, but these gains were not sustained.
Limited Impact of Bitcoin Treasury Strategy on GameStop's Performance
GameStop's core business model has historically depended on the sale of physical video games and the resale of used games. This model has been increasingly impacted by the ongoing decline in the physical media market.
In an effort to pivot towards a digital asset treasury company, GameStop raised $1.5 billion in April to finance Bitcoin purchases. Subsequently, in May, the company acquired 4,710 BTC as part of this strategic shift.
However, investor concerns regarding the digital asset strategy led to a significant drop in GameStop shares. The stock slid by 11% the day after the company announced its treasury pivot.
During a July conference, GameStop CEO Ryan Cohen expressed his view that cryptocurrencies, including Bitcoin, serve as hedges against inflation. He also hinted at potential plans to accept cryptocurrency as a form of payment at GameStop stores.
"The ability to actually use crypto within transactions is something that is an opportunity, and it’s something that we’re looking at," Cohen stated.
Cohen further elaborated that the company is actively working to reduce its dependence on physical hardware and game sales due to rising costs. Instead, GameStop is focusing on expanding its offerings in collectibles, such as trading cards.
The challenges faced by GameStop's stock are occurring within a broader context of a downturn affecting digital asset treasury companies. Standard Chartered attributes this trend to market saturation and increased investor caution.