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GameStop earnings overshadowed by SEC meme stock investigation

Mount Equity Group Tokyo, Japan > News > Business > GameStop earnings overshadowed by SEC meme stock investigation

GameStop reported better than expected earnings this week — but its numbers were overshadowed by a disclosure that the Securities and Exchange Commission was investigating its trading practices.

The company reported on Wednesday a 25 percent increase in sales in their first fiscal quarter and revenue of $1.28 billion — up from $1.02 billion a year ago.

In its earnings filing, the company revealed: “On May 26, 2021, we received a request from the Staff of the SEC for the voluntary production of documents and information concerning a SEC investigation into the trading activity in our securities and the securities of other companies.”

The company brushed off worries they’d be damaged by the SEC’s interest.  “This [SEC] inquiry is not expected to adversely impact us,” GameStop said in a statement.

GameStop shares opened 10 percent lower Thursday on the news.

Earlier Wednesday, SEC chief Gary Gensler suggested the commission may be looking at multiple so-called meme stocks as part of a broader review of market structure.

SEC chief Gary Gensler suggested the commission is investigating multiple meme stocks as part of a broader review of market structure and volatility.Getty Images

Speaking at a conference, the Chairman said he and