Why GameStop Stock Just Wiped Out All Its 2026 Gains -- Barrons.com

By George Glover

GameStop said it would swap $1.4 billion worth of debt for stock on Monday, sending the videogame retailer's shares tumbling.

The one-time meme stock slumped 7.7% to $20.05 in early trading, wiping out all of its gains for the year. The SP 500 was 0.5% higher after President Donald Trump said the U.S. would restart talks with Iran.

GameStop said in a press release on Monday that it had agreed to exchange about $1.4 billion of outstanding convertible senior notes due in 2030 and 2032 for shares of its Class A common stock.

Retiring debt by issuing stock dilutes existing shareholders and tends to trigger hedging and short-selling by institutional investors, which explains why GameStop was tumbling on Monday.

Shares had risen 8.2% in 2026 through the end of last week, powered higher by record-breaking profits and a $2 billion stock buyback plan.

Online marketplace platform eBay rejected a $56 billion takeover bid from GameStop in May, describing the much smaller company's proposal as "neither credible nor attractive."

Write to George Glover at george.glover@dowjones.com

This content was created by Barron's, which is operated by Dow Jones Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

August 03, 2026 09:43 ET (13:43 GMT)