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GameStop Shares Just Jumped 40% And Meme Stocks Might Be Back

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Picture this… 

The year is 2021. You just fired up your Robinhood app. You never heard of Ken Griffin. It's day 397 of "two weeks to flatten the curve." Davey Day Trader is Twitter beefing with Ross Gerber. Your mom just put Pizza Rolls in the oven. Life is good.

Good news, you guys: meme stocks are back…

Shares of GameStop jumped 40% after reporting for the quarter that inexplicably ended on January 28th (spoiler: that's not even the last day of the month).

WSJ - GameStop shares surged more than 40% after the retailer said cost cutting helped it record its first quarterly profit after seven consecutive quarters of losses.

GameStop has been working to turn around its business for close to two years under the leadership of a revamped executive team and board of directors.

Revenue came in just slightly below last year's Q4 ($2.23B vs. $2.25B). Keep in mind not enough real analysts (no, Reddit user cumdumpster69420’s DD doesn’t count…) cover GME to decide whether it beat or missed the Street’s expectations.

But it wasn’t the top line that had degens lining up to give Ryan Cohen a reach around. $GME was profitable for the first time in two years. The company made $48M during its Q4, a swing to profit from its massive $148M loss during the same period in 2022. 

So, what changed? I can’t believe I’m about to say this, but it appears that Ryan Cohen’s long promised turnaround plan is beginning to work.

Sure, that partnership with FTX was a black eye, but new CEO Matt Furlong is taking a page out of his former company’s (Amazon) playbook and slashing costs. The mall staple has been cutting jobs, pulling out of unfavorable markets, and probably offering even less on game trade-ins, all while getting inventory off of its balance sheet.

Just me or is this the finance gods sending a sign to Davey Day Trader to return?

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