GameStop joins FTX despite wider losses

A Partnership Between Gamestop and FTX Has Been Formed

The partnership between GameStop and FTX has been announced.

In accordance with a press statement that was distributed on September 7 and titled “GameStop to Enter Partnership with FTX’s American Division,” FTX.US will become a business partner of GameStop.

The announcement simply identifies a single particular course of action, which is that the gaming shop will carry FTX gift cards in some of their stores.

In addition to that, the two companies will work together on joint projects involving internet marketing and e-commerce. In addition, for the length of this collaboration, GameStop will serve as FTX’s preferred retail partner.

It is clear that the purpose of the acquisition is to attract GameStop’s customers to the services and marketplace offered by FTX. It is now unknown whether or not FTX will promote GameStop to its very own clientele.

According to the wording of today’s press release, the specifics of the financial terms of the transaction will not be made public.

In an earnings call, GameStop CEO Matt Furlong referred to the partnership as a “byproduct of our commerce and blockchain teams.” He went on to say that those teams are “collaborating” in order to “create something truly unique in the world of retail.”

GameStop made the collaboration announcement at the same time as company declared financial difficulties. The total revenues of the company decreased from $1.183 billion in the second quarter of 2021 to $1.136 billion in the second quarter of 2022.

In addition to that, it disclosed other losses. It incurred a net loss of $108.7 million during the second quarter of this year ($0.36 per share when diluted). It incurred a net loss of $61.6 million during the second quarter of 2021 ($0.21 per share after dilution).

Over the past few months, GameStop has made efforts to broaden its customer base by integrating cryptocurrency, more especially NFTs.

On July 11, the business announced the opening of its marketplace for non-fungible tokens. In spite of the fact that it had been anticipated for months, the market appears to have achieved just a moderate level of success: on September 7th, it had only 759 daily traders and had a daily volume of $113,000.

In spite of this moderate success, GameStop will continue to pursue “long-term growth in the bitcoin, NFT, and Web 3.0 gaming sectors,” as Furlong stated in today’s call.

It is not yet known whether the gaming company’s most recent cooperation will be beneficial in assisting it in achieving those objectives.