GameStop Plummets After Roaring Kitty Livestream, Surprise Earnings Report, and Stock Offering Announcement

GameStop (GME) faced a tumultuous day as the stock plummeted by 40% following Keith Gill‘s highly anticipated livestream on YouTube. Gill, famously known as ‘Roaring Kitty‘ among retail investors, made a return to the spotlight, causing a surge in volatility that led to multiple trading halts on the New York Stock Exchange.

During the approximately 50-minute livestream, Gill shared insights into his speculative trading approach, emphasizing the risky nature of his investments. Dressed in bandages and a sling as a humorous nod to the day’s stock performance, Gill disclosed his significant positions in GME, including 5,000 shares and 120,000 call options.

Despite displaying a total gain of $146 million, Gill acknowledged a daily loss of $163 million, underscoring the rollercoaster nature of meme stock trading. He took a humorous dig at E*TRADE, where his positions were held, amidst rumors of potential account removal.

Gill asserted his independence in trading, dispelling rumors of collaboration with hedge funds or other large players. The livestream, shorter than his previous broadcasts, shed light on GameStop’s surprise first-quarter earnings report, which revealed a net loss of $32 million and a decline in net sales.

In response to the stock’s meteoric rise, GameStop announced a new offering of up to 75 million shares, aimed at bolstering capital. This strategic move aligns with the company’s shift towards a digital transformation strategy under the leadership of CEO Ryan Cohen.

Frontier Airlines also made headlines by sponsoring Gill’s livestream, showcasing the growing intersection of retail trading culture with mainstream brands. The stock market reaction to these developments was swift, with GME experiencing significant volatility throughout the day.