GameStop stock jumped about 5% in early trading Monday after the video game retailer announced preliminary second-quarter results, expecting a boost in profit partly due to its stake in eBay. The company said it expects net income of $290 million to $310 million for the quarter ending Aug. 1, compared with $168.6 million in the prior-year period. GameStop converted its eBay derivative position into eBay shares, generating about $238 million in gains, and now owns 43.4 million shares of eBay common stock valued at more than $4.9 billion. However, revenue is expected to decline to between $780 million and $800 million, down from $972.2 million last year. The preliminary numbers were released in connection with an amendment to its private exchange of $1.4 billion in convertible notes. GameStop stock is down 11% year to date, and earlier this year its unsolicited $56 billion bid to purchase eBay was rejected.
GameStop Corp.Preliminary Q2 profit boosted by gains from eBay stake, exceeding prior-year net income.
eBay IncGameStop's stake in eBay generates gains, but eBay is not the subject of the news.
