After announcing a new strategy to invest in Bitcoin last week, video game retailer GameStop now has the money to make it happen.
GameStop announced on Tuesday that it has raised $1.5 billion in a private offering of convertible notes, according to a recent filing with the Securities and Exchange Commission (SEC). A convertible note is a type of debt that lets investors convert loans into equity at some point in the future. The offering was restricted to “qualified institutional buyers,” and investors will be unable to convert the notes into equity until 2030.
“The company expects to use the net proceeds from the offering for general corporate purposes, including the acquisition of Bitcoin,” the filing said, without providing a timeline for the purchases.
GameStop did not immediately respond to a request for comment from Fortune.
The offering comes a week after GameStop announced plans to purchase $1.3 billion in Bitcoin. The shift in strategy, from selling video games to also investing in crypto in hopes that it rises in value, is an attempt to “provide sufficient liquidity to meet the day-to-day financial obligations of the Company, and to optimize investment returns,” the company said in an SEC filing.
The news was initially met with a 14% spike in GameStop’s stock price, but the bump was short-lived. The following day GameStop shares fell 23%, erasing all the gains the company made following the announcement, signaling that investors may be skeptical of the Bitcoin investment plan.
Over the last decade, GameStop has struggled to keep up with a shift in customer interest from brick and mortar video games to digital ones. The company reported a 28% decline in sales last year, from $5.3 billion in 2023 to $3.8 billion in 2024, according to a recent SEC filing. Because of this, GameStop has shuttered a quarter of its stores in 2024. Alongside its Bitcoin investment plan, the company also announced plans to close a “significant number” of additional stores in the coming months.
The video game retailer seems to be following in the footsteps of software company Strategy in an attempt to boost its stock. Led by Bitcoin advocate Michael Saylor, Strategy (formerly Microstrategy) has amassed nearly 530,000 Bitcoins since 2020, currently worth over $45 billion. Since pivoting to investing in Bitcoin five years ago, Strategy’s stock has soared over 2,500%, boosted by the currency’s bull run after the November election.
