GameStop Corp.
For the period ended May 2, 2026. Filed Jun 11, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
May 2, 2026 · Filed Jun 11, 2026
GME$25.12+3.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-11-01; filed 2025-12-09.
0001326380-25-000098
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-05-02; filed 2026-06-11.
0001326380-26-000025
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 114 previous paragraphs and 112 current paragraphs.
36 unchanged; 22 reworded; 54 added; 56 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (54)
Current report
Our strategy has evolved into two distinct but complementary pillars:
Current report
•Capital Allocation: Utilizing our significant capital resources to actively evaluate and execute on opportunities to acquire, invest in, or partner with businesses that offer long-term value.
Current report
•Operational Excellence: Maximizing the cash flow of our legacy retail business by optimizing our store fleet.
Current report
Capital Deployment and Investment Strategy
Current report
The Company views its balance sheet as a strategic asset. We continue to review the best use for our cash and other sources of liquidity, including potential control transactions and transformational acquisitions.
Current report
While we do not limit our review to specific industries, our Investment Committee is actively evaluating opportunities that offer long-term value.
Current report
Investment Policy & Guidelines
Current report
To ensure the Company can act on these opportunities with speed and efficiency, the Board has delegated authority to an Investment Committee of the Board to manage the Company’s cash and other sources of liquidity and to review potential acquisition and control opportunities.
Current report
We are optimizing our retail footprint. We view our extensive domestic network of physical locations not merely as stores, but as fulfillment and service anchors that provide immediate capabilities.
Current report
Expand Our Addressable Market
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•Strategic Validation: Our recent initiatives have validated our thesis that consumers value transactional speed and convenience. By utilizing our stores as efficient trade-in destinations, we have demonstrated that our infrastructure can drive transaction volume and customer engagement.
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•The Network Effect: We believe our dense store network serves as a competitive advantage.
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Maximize Profitability
Current report
The Company continues to focus on cost containment to maximize operating income.
Current report
•Indirect Spend: We have focused on eliminating non-income generating spend. In fiscal 2025, we significantly reduced indirect costs and intend to continue this discipline in 2026.
Current report
•International Streamlining: We continue to evaluate our international assets for strategic relevance. In the past three years, the Company has exited operations in Ireland, Switzerland, Austria, Germany, New Zealand, Italy and Canada. In addition, the Company has signed an agreement related to a potential sale of its operations in France to a strategic buyer.
Current report
Forward-Looking Statement on Acquisitions
Current report
While the Company has no binding agreements for a specific transaction at this time, we are actively evaluating opportunities that could require significant capital deployment. Shareholders should understand that our strategy is now explicitly focused on leveraging our cash, flexible capital structure, and stock to acquire assets that we believe will undergo a significant re-rating under our stewardship.
Current report
Subsequent to the end of the first quarter of fiscal 2026, the Company announced a non-binding proposal to acquire eBay Inc.
Current report
First Quarter Developments
Current report
During the first quarter of fiscal 2026, we continued to advance the strategic priorities we pursued throughout fiscal 2025. Net sales increased 14.0% to $835.3 million compared to the prior-year period — a positive comparison achieved notwithstanding the smaller store base and reduced international footprint resulting from the actions we took during fiscal 2025, including the closure of underperforming stores in the United States, the divestiture of our Canadian operations, and the wind-down of our operations in New Zealand. The increase was driven primarily by continued growth in our collectibles category.
Current report
Consistent with our focus on the growth of collectibles, we continued to expand the store space and roll out new fixtures dedicated to the category to support in-store collectibles sales.
Current report
We also continued our profit-optimization efforts during the quarter, including further reductions in selling, general and administrative expenses through ongoing cost-discipline and indirect-spend initiatives.
Current report
Consistent with our capital allocation strategy, during the first quarter of fiscal 2026 we obtained economic exposure to approximately 5% of eBay's outstanding common stock through a series of put and call option transactions. These transactions resulted in a Derivative asset and an Unrealized gain on derivative asset, net recognized during the quarter. See "Liquidity and Capital Resources" below and Part I, Item 1, "Notes to the Condensed Consolidated Financial Statements" for additional information.
Current report
Our balance sheet continued to reflect the proceeds of our 0.00% Convertible Senior Notes due 2030 and 2032, our Bitcoin treasury reserve holdings and related receivables, and the Warrant Distribution completed in fiscal 2025 (NYSE: GME WS), under which a nominal number of warrants were exercised during the quarter. Total Cash, cash equivalents, Marketable securities, Digital assets and related receivables, and Collateral pledged for derivative assets were $9,721.0 million as of May 2, 2026. This total included$7,397.6 million of Cash and cash equivalents,$970.5 million of Marketable securities, $983.3 million of Collateral pledged for derivative asset during the quarter, and approximately$369.6 million in Digital assets and related receivables.
Current report
As previously announced, we have entered into an agreement for the potential sale of our operations in France. We do not anticipate closing a significant number of stores in fiscal 2026, as we view our domestic store footprint as a core component of our logistics and fulfillment infrastructure.
Current report
During the three months ended May 2, 2026, total Net sales increased $102.9 million, or 14.0% compared to the prior year. Net sales increased 21.6% in Australia, 21.1% in the United States, and 13.1% in Europe, while Net sales declined 100.0% in Canada. The overall increase in consolidated Net sales was primarily driven by a $137.4 million or 65.0% increase in collectibles sales, partially offset by a decline in software sales of $22.9 million or 13.0% and a decline in hardware and accessories sales of $11.6 million, or 3.4%. The decline in the Canada segment reflects the divestiture of that business in the second quarter of fiscal 2025.
Current report
Gross profit increased $87.5 million, or 34.6% during the three months ended May 2, 2026, compared to the prior year. Gross profit as a percentage of Net sales increased to 40.7%, from 34.5% in the prior year.
Current report
The increase in Gross profit and gross margin was primarily driven by a shift in sales mix towards higher-margin product categories, particularly collectibles. Sales of collectibles increased to 41.8% of total Net sales for the three months ended May 2, 2026, compared to 28.9% in the prior year.
Current report
The reduction in SG&A was driven by a $9.5 million decrease in labor-related costs, consulting services, and marketing expenses as part of our ongoing cost-optimization initiatives. In addition, store-related rent and occupancy costs and depreciation expense decreased $15.1 million and $1.0 million, respectively, primarily due to store closures and international divestitures completed in recent periods.
Current report
Interest income, net increased $26.8 million to $83.7 million for the three months ended May 2, 2026, compared to $56.9 million in the prior year. The increase was primarily driven by higher Cash and cash equivalent, and Marketable securities balances resulting from the issuance of the Convertible 2030 Notes and Convertible 2032 Notes.
Current report
Unrealized Gain on Derivative Asset, net
Current report
During the three months ended May 2, 2026, Unrealized gain on derivative asset, net increased $268.4 million or 100% compared to the prior year. The increase in the Unrealized gain on derivative asset, net for the three months ended May 2, 2026 was due to the Company entering into the Put/Call Pairs that provide economic exposure to the eBay Common Stock.
Current report
Gain on Digital Assets and Related Receivables
Current report
Gain on digital assets and related receivables increased to $1.1 million for the three months ended May 2, 2026, compared to no such gain in the prior year.
Current report
Income Tax Expense
Current report
The increase in income tax expense was driven primarily by significantly higher pre-tax income for the three months ended May 2, 2026 compared to the three months ended May 3, 2025. The increase in theeffective tax rate reflects the recognition of certain tax benefits available during the three months ended May 3, 2025, which reduced income tax expense in that period but were substantially all utilized in fiscal 2025. The difference between our effective tax rate and the U.S. federal statutory rate of 21% is primarily attributable to state income taxes. The difference between our effective tax rate and the statutory income tax rate in the current year period is primarily due to the state income taxes.
Current report
In fiscal 2025, we reclassified Cash and Marketable securities associated with the French disposal group to Assets held for sale on the condensed consolidated balance sheets. As of May 2, 2026, the French disposal group included$28.5 millionof cash and an immaterial amount of marketable securities within Assets held for sale. See Note 9, "Asset Held for Sale," for additional information.
Current report
During the first quarter of fiscal 2026, we pledged $983.3 million of cash as collateral in support of our Derivative asset positions, reducing our available liquidity by a corresponding amount. See Note 10, “Derivative Asset,” for additional information.
Current report
Gains and losses on marketable securities may fluctuate significantly from period to period in the future and could have a significant impact on the Company’s results of operations. However, the amount of gain or loss on marketable securities for any given period may have no predictive value and variations in amount from period to period may have no analytical value.
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Removed paragraphs (56)
Previous report
Effective May 4, 2025, we operate ourbusiness in three geogr aphic segments: United States, Australia and Europe. During the second quarter of fiscal 2025 we divested our operations in Canada, which previously comprised a fourth separate reporting segment. See Note 8, "Segment Information," for further details.
Previous report
Our fiscal year is composed of the 52 or 53 weeks ending on the Saturday closest to the last day of January. Fiscal 2025 consists of 52 weeks ending January 31, 2026 ("fiscal 2025"). Fiscal 2024 consisted of 52 weeks ended on February 1, 2025. All nine-month periods presented herein contain 39 weeks. All references to years, quarters and months relate to fiscal periods rather than calendar periods. The discussion and analysis of our results of operations refers to continuing operations unless otherwise noted. Our business, like that of many retailers, is seasonal, with the major portion of the net sales realized during the fourth quarter, which includes the holiday selling season.
Previous report
Our strategy involves (i) using our cash and other sources of liquidity to maximize shareholder value, including through potential investment and/or acquisition opportunities and (ii) optimizing our retail business to achieve profitability.
Previous report
Investment Policy
Previous report
Investments are made in accordance with the guidelines in the Investment Policy that is reviewed at least annually, with oversight conducted by the Investment Committee and other senior executive officers of the Company.
Previous report
On March 25, 2025, we announced that, as part of our revisions to the Investment Policy, the Board approved the addition of Bitcoin as a treasury reserve asset, whereby a portion of our cash or future debt and equity issuances may be invested in Bitcoin. We have not set a maximum amount of Bitcoin we may accumulate. We may also sell any Bitcoin we may acquire.
Previous report
GameStop is actively focused on the below objectives:
Previous report
•Establish Omnichannel Retail Excellence. We aim to be the leading destination for games and entertainment products through our stores and ecommerce platforms;
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•Achieve Profitability. During fiscal 2024, we continued to optimize our cost structure to align with our current and anticipated future needs. We will continue to focus on cost containment as we look to operate with increased efficiency; and
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In connection with our efforts to achieve sustained profitability, we continue to evaluate our international assets and operations, to determine their strategic and financial fit and to eliminate redundancies and underperforming assets. To date we have taken the following steps as part of this ongoing effort:
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•During fiscal 2023, we exited our operations in Austria, Ireland and Switzerland;
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•During the fourth quarter of fiscal 2024 we closed down our store operations in Germany;
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•During the fourth quarter of fiscal 2024, we sold our Italian subsidiary, GameStop Italy S.r.l, which operated our Italian stores and e-commerce business;
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•During the first quarter of fiscal 2025, we announced a plan to pursue a sale of our operations in Canada and France; and
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•During the second quarter of fiscal 2025, we completed the sale of our Canadian subsidiary, Electronic Boutique Canada, Inc., which operated our Canadian stores and e-commerce business.
Previous report
While we expect our cost containment efforts to yield reductions in Selling, general and administrative ("SG&A") expenses in the long term, we have incurred and may continue to incur non-recurring costs related to these efforts in the short term.
Previous report
We also continue to explore ways to increase the size of our addressable market through new product and service offerings, including offerings in the graded collectibles category. On October 15, 2024, GameStop announced that it had entered into a collaboration with Collectors Holdings, Inc., through its Professional Sports Authenticator division ("PSA"). As part of this collaboration, GameStop became an authorized PSA dealer, and PSA provides autograph authentication and grading services for trading cards through select GameStop stores across the United States. During the second quarter of fiscal year 2025, the Company announced the launch of Power Packs, a new digital trading card platform in partnership with PSA. Power Packs is an online e-commerce experience where collectors buy graded PSA cards that are securely stored in the PSA vault. Each card can be sold back instantly, traded, shipped to the collector, or held for future offers.
Previous report
Net sales decreased $39.3 million, or 4.6%, for thethree months ended November 1, 2025, compared to the prior year.
Previous report
During the three months ended November 1, 2025, net sales in our Europe and Canada segments decreased by 45.7% and 100.0%, respectively, compared to the prior year while the net sales in the Australia and the United States segments increased by 23.3% and 11.8%, respectively, compared to the prior year. The decrease in consolidated net sales for the three months ended November 1, 2025 compared to the prior year was primarily due to a decrease in the sales of software of $74.3 million or 27.3% and a decrease in the sale of hardware and accessories of $50.0 million, or 12.0%. This was partially offset by an increase in the sale of collectibles of $85.0 million, or 49.7%. The decrease in net sales in our Canada segment was due to the divestiture of Canada in the second quarter of fiscal 2025. The decrease in net sales in our Europe segment was primarily due to the divestiture of Italy, and the closure of our operations in Germany, both occurring during the second half of fiscal 2024.
Previous report
Net sales decreased $14.8 million, or 0.6%, for the nine months ended November 1, 2025, compared to the prior year.
Previous report
During the nine months ended November 1, 2025, net sales in our Europe and Canada segments decreased by 37.8% and 69.8%, respectively, compared to the prior year while the net sales in the Australia and United States segments increased by 29.7% and 9.6%, respectively, compared to the prior year. The decrease in consolidated net sales for the nine months ended November 1, 2025 compared to the prior year was primarily due to a $193.6 million, or 26.9%, decline in the sale of software and a $69.1 million, or 5.0% decline in the sale of hardware and accessories, partially offset by a $247.9 million, or 55.4%, increase in the sale of collectibles. The decrease in net sales in our Canada segment was due to the divestiture of Canada in the second quarter of fiscal 2025. The decrease in net sales in our Europe segment was primarily due to the divestiture of Italy, and the closure of our operations in Germany, both occurring during the second half of fiscal 2024.
Previous report
During the three months ended November 1, 2025, gross profit increased $16.2 million, or 6.3%,compared to the prior year. Gross profit as a percentage of net sales increased to 33.3%, compared to 29.9% in the prior year. The increase in gross profit as well as gross profit as a percentage of net sales, is primarily due to a shift to higher margin product categories, specifically collectibles. Sales of collectibles as a percentage of total net sales increased to 31.2% for the three months ended November 1, 2025, compared to 19.9% in the prior year.
Previous report
During thenine months ended November 1, 2025, gross profit increased $58.8 million, or 7.8%, compared to the prior year. Gross profit as a percentage of net sales increased to 32.0%, compared to 29.5% in the prior year. The increase in gross profit, as well as gross profit as a percentage of net sales, is primarily due to a shift to higher margin product categories, specifically collectibles. Sales of collectibles as a percentage of total net sales increased to 27.5% for thenine months ended November 1, 2025, compared to 17.6% in the prior year.
Previous report
The decrease in SG&A expenses for the three months ended November 1, 2025 compared to the prior year is primarily due to a reduction in labor-related, consulting services, and marketing costs of $23.6 million, driven by our continued focus on cost reduction efforts. Additionally, store-related costs and depreciation decreased by $27.4 million and $4.0 million, respectively, in the current year, primarily in connection with prior year store closures and international divestitures.
Previous report
During the nine months ended November 1, 2025, SG&A expenses decreased $179.6 million, or 21.2%, compared to the prior year. SG&A expenses as a percentage of sales decreased to 26.5%, compared to 33.4% in the prior year.
Previous report
The decrease in SG&A expenses for the nine months ended November 1, 2025 compared to the prior year is primarily due to a reduction in labor-related, consulting services, and marketing costs of $79.2 million, driven by our continued focus on cost reduction efforts. Additionally, store-related costs and depreciation decreased by $73.8 million and $18.1 million, respectively, in the current year, primarily in connection with prior year store closures and international divestitures.
Previous report
During the three months ended November 1, 2025, we recognized a $10.7 million asset impairment expense, compared to an $8.6 million impairment expense for the prior year period. Asset impairment as a percentage of sales was 1.3% for the three months ended November 1, 2025. The asset impairment expense in the current quarter was primarily the result of the remeasurement of the carrying value of the French disposal group compared to its fair value. The asset impairment expense in the prior year was primarily due to a plan approved by management in the third quarter of fiscal 2024 to divest the Company's operations in Italy.
Previous report
During the three months ended November 1, 2025, we recognized net interest income of $49.0 million compared to $54.2 million for the same period in the prior year period. The decrease was primarily due to a noncash, nonrecurring interest charge of $42.2 million related to the issuance of warrants during the third quarter of fiscal 2025 to the holders of the Convertible 2030 Notes and Convertible 2032 Notes, partially offset by interest earned on higher balances of cash and cash equivalents from the issuance of the Convertible 2030 Notes and Convertible 2032 Notes during the first and second quarters of fiscal 2025.
Previous report
During the nine months ended November 1, 2025, we recognized net interest income of $185.5 million, compared to net interest income of $108.6 million for the nine months ended November 2, 2024. Net interest income increased primarily due to higher balances of cash and cash equivalents resulting from the issuance and sale of shares of our common stock in the ATM Offerings in fiscal 2024 as well as the issuance of the Convertible 2030 Notes and Convertible 2032 Notes, partially offset by a noncash, nonrecurring interest charge of $42.2 million related to the issuance of warrants during the third quarter of fiscal 2025 to the holders of the Convertible 2030 and Convertible 2032 Notes.
Previous report
Unrealized loss (gain) on digital assets
Previous report
During the three months ended November 1, 2025, the unrealized loss on digital assets increased by $9.2 million, or 100%, compared to the prior year. Unrealized loss on digital assets as a percentage of sales was 1.1% for the three months ended November 1, 2025. During the nine months ended November 1, 2025, unrealized gain on digital assets increased by $19.4 million, or 100%, compared to the prior year. Unrealized gain on digital assets as a percentage of sales was 0.8% for the nine months ended November 1, 2025.
Previous report
The unrealized loss on digital assets for the three months ended November 1, 2025 and the unrealized gain on digital assets for the nine months ended November 1, 2025 was due to the Company purchasing 4,710 of Bitcoin during the second quarter of fiscal 2025.
Previous report
Income Tax
Previous report
We recognized income tax expense of $16.5 million for the nine months ended November 1, 2025, compared to an income tax expense of$2.6 millionfor the nine months November 2, 2024. Our effective income tax rate was 5.4% for the nine months ended November 1, 2025 compared to 100.0% for the nine months ended November 2, 2024.
Previous report
Our effective income tax rate for the three and nine months ended November 1, 2025 was primarily due to forecasted income taxes due in certain jurisdictions in which we operate, partially offset by tax benefits recognized in the current period.
Previous report
Our effective income tax rate for the three and nine months ended November 2, 2024 was primarily due to tax expense recognized during the third quarter in connection with our sale of property in Ireland, and in connection with an Italian tax audit.
Previous report
The difference between our effective income tax rates and the statutory income tax rate is primarily due to the impact of the Company's valuation allowance.
Previous report
On March 18, 2025, our Board of Directors (the "Board") unanimously authorized a revised investment policy (the "Investment Policy"). In accordance with the revised Investment Policy, the Board has delegated authority to manage the Company’s portfolio of securities investments to an Investment Committee of the Board consisting of the Company’s Chairman and Chief Executive Officer, Ryan Cohen, as well as two independent members of the Board, together with such personnel and advisors the Investment Committee may further choose.
Previous report
On March 25, 2025 we announced that, as part of our revisions to the Investment Policy, the Board approved the addition of Bitcoin as a treasury reserve asset, whereby a portion of our cash or future debt and equity issuances may be invested in Bitcoin. Such investments are classified as Digital Assets on our Condensed Consolidated Balance Sheets, and are recorded at fair value. During the second quarter of fiscal year 2025, the Company purchased 4,710 Bitcoin for $500 million. We may from time to time sell some of our Bitcoin as part of treasury management operations.
Previous report
Pursuant to the prospectus supplement relating to the ATM Offering filed with the SEC on May 17, 2024 (the “May Prospectus Supplement”), we sold an aggregate of 45.0 million Common Shares for aggregate gross proceeds before commissions and offering expenses of approximately$933.4 million.
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Reworded paragraphs (22)
Previous wording
GameStop Corp. (“GameStop,” “we,” “us,” “our,” or the “Company”), a Delaware corporation established in 1996, is a leading specialty retailer offering games and entertainment products through its thousands of stores and ecommerce platforms.
Current wording
GameStop Corp. ("GameStop," "we," "us," "our" or the "Company"), a Delaware corporation established in 1996, offers games, collectibles, and entertainment products through its stores and ecommerce platforms. As we navigate the evolving commercial landscape, our business model is expanding beyond traditional retail to include value creation through disciplined capital allocation, and we view our significant cash and other sources of liquidity as a strategic asset to be deployed into investments, acquisitions, and control transactions that we believe offer long-term value.
Previous wording
The overall goals of the Investment Policy are to provide sufficient liquidity to meet the day-to-day financial obligations of the Company, and to optimize investment returns within the guidelines of the Investment Policy. Permissible investment instruments include cash and cash equivalents (e.g., bank obligations, money market funds, and commercial paper), fixed income securities (e.g., obligations of the U.S. Treasury and U.S. Government, tax exempt obligations of states and municipalities, and corporate bonds/notes), equity securities (limited to those listed on the New York Stock Exchange (“NYSE”), NYSE American, NYSE Arca or the Nasdaq Stock Market and in compliance with the listing standards of the applicable exchange) and certain crypto-currencies, including Bitcoin. Individual exceptions to the Investment Policy may only be made by the unanimous agreement of the Investment Committee or, if the Investment Committee is unable to reach unanimous agreement on such exception, by the Board.
Current wording
Investments are made in accordance with the guidelines of an Investment Policy that is reviewed at least annually by the Board. Permissible investment instruments include cash and cash equivalents (e.g., bank obligations, money market funds, and commercial paper), fixed income securities (e.g., obligations of the U.S. Treasury), equity securities (limited to those listed on major exchanges), derivative instruments and options, and certain crypto-currencies, including Bitcoin.
Previous wording
On March 18, 2025, our Board of Directors (the "Board") unanimously authorized a revised investment policy (the "Investment Policy"). In accordance with the Investment Policy, the Board has delegated authority to manage the Company’s portfolio of securities investments to an Investment Committee of the Board (the "Investment Committee") consisting of the Company’s Chairman and Chief Executive Officer, Ryan Cohen, as well as two independent members of the Board, together with such personnel and advisors the Investment Committee may further choose. The Investment Committee regularly reviews risks related to the Company's investment portfolio, including concentration risk. When allocating cash to various investment opportunities and considering related investment risk, the Investment Committee considers market-based factors, including risk adjusted after-tax yields. When reviewing concentration risk, the Investment Committee considers the liquidity needs of the Company, among other things.
Current wording
•Structure: The Committee consists of the Company’s Chairman and Chief Executive Officer, Ryan Cohen, and two independent members of the Board.
Previous wording
The Investment Committee directs the investment activity of the Company in public and private markets pursuant to authority granted by the Board. Depending on certain market conditions and various risk factors, Mr. Cohen or other members of the Investment Committee, each in their personal capacity or through affiliated investment vehicles, may at times invest in the same securities in which the Company invests. The Board anticipates that such investments will align the interests of the Company with the interests of related parties because it places the personal resources of such directors at risk in substantially the same manner as resources of the Company in connection with investment decisions made by the Investment Committee on behalf of the Company.
Current wording
•Alignment of Interests: Depending on certain market conditions and various risk factors, Mr. Cohen or other members of the Investment Committee, each in their personal capacity or through affiliated investment vehicles, may at times invest in the same securities in which the Company invests. The Board anticipates that such investments will align the interests of the Company with the interests of related parties because it places the personal resources of such directors at risk in substantially the same manner as resources of the Company.
Previous wording
•Expand Our Addressable Market. We continue to explore ways to increase the size of our addressable market through new product and service offerings, including offerings in the graded collectibles category. Expansion of these categories provides the Company with margin accretive opportunities that can assist the Company in achieving its profitability goals.
Current wording
The Company continues to explore ways to increase the size of its addressable market through new product and service offerings.
Previous wording
During fiscal 2024, we initiated a comprehensive store portfolio optimization review which involves identifying stores for closure based on many factors, including an evaluation of current market conditions and individual store performance. This review, among other things, resulted in the closure of 590 stores in the United States in fiscal 2024. We anticipate closing a significant number of additional stores in fiscal 2025.
Current wording
•Store Fleet Optimization: Each year, the Company performs a comprehensive store portfolio optimization review which involves identifying stores for closure based on many factors, including an evaluation of current market conditions and individual store performance. This review resulted in the closure of 727 stores in the United States in fiscal 2025. At this time, we do not anticipate closing a significant number of stores in fiscal 2026, as we view our domestic footprint as a core component of our logistics infrastructure strategy.
Previous wording
The Three and Nine Months Ended November 1, 2025 Compared to the Three and Nine Months Ended November 2, 2024
Current wording
The Three Months Ended May 2, 2026 Compared to the Three Months Ended May 3, 2025
Previous wording
During the three months ended November 1, 2025, SG&A expenses decreased $60.6 million, or 21.5%, compared to the prior year. SG&A expenses as a percentage of sales decreased to 27.0%, compared to 32.8% in the prior year.
Current wording
Selling, general, and administrative ("SG&A") expenses decreased $26.5 million, or 11.6% for the three months ended May 2, 2026 compared to the prior year. SG&A as a percentage of Net sales decreased to 24.1% in the current year period compared to 31.1% in the prior year.
Previous wording
During the nine months ended November 1, 2025, asset impairment expense was $44.1 million, compared to an $8.6 million asset impairment expense in the prior year period. Asset impairment as a percentage of sales was 1.7% for the nine months ended November 1, 2025. The asset impairment expense in the current year was primarily due to a plan approved by management in the first quarter of fiscal 2025 to divest the Company's operations in Canada and France, and the corresponding reclassification of all related assets and liabilities as held for sale. Impairment expense of $18.3 million was recorded on the Canadian disposal group during the first fiscal quarter, and the divestiture was completed during the second fiscal quarter. Impairment expense of $23.1 million has been recorded on the French disposal group during the current year, reflecting remeasurements of the carrying value of the French disposal group compared to its fair value. The asset impairment expense in the prior year was primarily due to a plan approved by management in the third quarter of fiscal 2024 to divest the Company's operations in Italy.
Current wording
Asset impairment was a benefit of $4.6 million for the three months ended May 2, 2026, compared to an expense of $35.5 million in the prior year. As a percentage of Net sales, Impairment expense was (0.6)% during the current year period, compared to 4.8% in the prior year. The change was primarily attributable to management's plan, approved in the first quarter of fiscal 2025, to divest the Company's operations in Canada and France, resulting in the reclassification of the related assets and liabilities as held for sale. We recorded $18.3 million of Impairment expense related to the Canadian disposal group in the first quarter of fiscal 2025, and the divestiture was completed during the second quarter of fiscal 2025. We recorded $17.2 million of impairment expense related to the French disposal group in the first quarter of fiscal 2025, and the divestiture is expected to be completed during the current fiscal year.
Previous wording
We recognized income tax expense of $7.0 million for the three months ended November 1, 2025, compared to an income tax expense of $3.4 million for the three months ended November 2, 2024. Our effective income tax rate was 8.3% for the three months ended November 1, 2025 compared to 16.3% for the three months ended November 2, 2024.
Current wording
We recognized Income tax expense of $116.8 million for the three months ended May 2, 2026, compared to an Income tax expense of $3.5 million for the three months ended May 3, 2025. Our effective income tax rate was 23.1% for the three months ended May 2, 2026 compared to 7.2% for the three months ended May 3, 2025.
Previous wording
See Part I, Item 1 "Notes to the Condensed Consolidated Financial Statements,"Note 10, "Income Taxes," for additional information.
Current wording
See Note 12, "Income Taxes," for additional information.
Previous wording
Our principal sources of liquidity are cash on hand and cash provided by operations. As of November 1, 2025, we had total unrestricted cash and cash equivalents on hand of$7,842.7 million.
Current wording
Our principal sources of liquidity are cash on hand and cash from operations. As of May 2, 2026, we had$7,397.6 million of unrestricted cash and cash equivalents, and $970.5 million of marketable securities.
Previous wording
Our cash and cash equivalents are carried at cost, which approximates fair value, and consists primarily of cash, money market funds, cash deposits with commercial banks, and highly rated direct short-term instruments that mature in 90 days or less.
Current wording
Our Cash and cash equivalents are carried at cost, which approximates fair value, and consist primarily of cash, money market funds, cash deposits with commercial banks, and highly rated direct short-term instruments with original maturities of 90 days or less.
Previous wording
Our marketable securities are carried at fair value and primarily include investments in certain highly-rated short-term government notes, government bills, and time deposits. During the first quarter of fiscal 2025, we reclassified$11.4 million ofthe investment portfolios' balance, all of which had an original maturity in excess of 90 days and less than one year, to Assets held for sale in the Condensed Consolidated Balance Sheets. Following the reclassification, the amount is no longer included in the total marketable securities balance. As of November 1, 2025, the investment portfolios' aggregate balance within Assets held for sale is immaterial. See Item 1, Part I, "Notes to the Consolidated Financial Statements,"Note 4, "Fair Value Measurements," for additional information.
Current wording
Our Marketable securities are carried at fair value and include investments in certain highly-rated short-term government notes, government bills, commercial paper, and time deposits. As of May 2, 2026,$970.5 million of these investments had original maturities in excess of 90 days and less than one year and are classified as "Marketable securities" on our condensed consolidated balance sheets.
Previous wording
In fiscal 2021, the six separate unsecured term loans held by our French subsidiary, Micromania SAS, for a total of €40.0 million, were extended for five years. During the first quarter of fiscal 2025, we reclassified the French Term Loans to Liabilities held for sale on the Condensed Consolidated Balance Sheets where it continues to be measured at the lower of its carrying amount and fair value less costs to sell. As of November 1, 2025, $10.2 million remains outstanding and classified in Liabilities held for sale.
Current wording
In fiscal 2021, six separate unsecured term loans held by our French subsidiary, Micromania SAS, for a total of€40.0 million were extended for five years. During the first quarter of fiscal 2025, we reclassified the French Term Loans to Liabilities held for sale on the consolidated balance sheets where it continues to be measured at the lower of its carrying amount and fair value less costs to sell. As of May 2, 2026,$8.9 million remains outstanding and classified in "Liabilities held for sale."
Previous wording
We maintain uncommitted facilities with certain lenders that provide for the issuance of letters of credit and bank guarantees, at times supported by cash collateral. As of November 1, 2025, we had letters of credit and other bank guarantees outstanding in the amount of $6.6 million.
Current wording
We maintain uncommitted facilities with certain lenders that provide for the issuance of letters of credit and bank guarantees, at times supported by cash collateral. As of May 2, 2026, we had letters of credit and other bank guarantees outstanding in the amount of$7.2 million.
Previous wording
On April 1, 2025, we completed a private offering of $1,500 million aggregate principal amount of 0.00% Convertible Senior Notes due 2030 (the "Convertible 2030 Notes"), including the exercise in full of the initial purchaser's option to purchase up to an additional $200 million aggregate principal amount of the Convertible 2030 Notes. The Convertible 2030 Notes are general unsecured obligation of the Company. The Convertible 2030 Notes were issued pursuant to an Indenture, dated April 1, 2025, between the Company and U.S. Bank Trust Company, National Association (the "Trustee"), as trustee.
Current wording
On April 1, 2025, we completed a private offering of $1,500 million aggregate principal amount of 0.00% Convertible Senior Notes due 2030 (the "Convertible 2030 Notes"), including the exercise in full of the initial purchaser's option to purchase up to an additional $200 million aggregate principal amount of the Convertible 2030 Notes. The Convertible 2030 Notes are general unsecured obligations of the Company. The Convertible 2030 Notes were issued pursuant to an Indenture, dated April 1, 2025, between the Company and U.S. Bank Trust Company, National Association (the "Trustee"), as trustee.
Previous wording
On June 17, 2025, we completed a private offering of $2,250 million aggregate principal of 0.00% Convertible Senior Notes due 2032 (the "Convertible 2032 Notes" and, collectively with the Convertible 2030 Notes, the "Convertible Notes"). Pursuant to the purchase agreement between the Company and the initial purchaser of the Notes, the Company granted the initial purchaser an option to purchase, for settlement within a period of 13 days from, and including, the date the Notes are first issued, up to an additional $450 million aggregate principal amount of Notes. The Convertible 2032 Notes are general unsecured obligation of the Company. The Convertible 2032 Notes were issued pursuant to an Indenture, dated June 17, 2025, between the Company and the Trustee, as trustee.
Current wording
On June 17, 2025, we completed a private offering of $2,250 million aggregate principal of 0.00% Convertible Senior Notes due 2032 (the "Convertible 2032 Notes" and, collectively with the Convertible 2030 Notes, the "Convertible Notes"). Pursuant to the purchase agreement between the Company and the initial purchaser of the Notes, the Company granted the initial purchaser an option to purchase, for settlement within a period of 13 days from, and including, the date the Notes are first issued, up to an additional $450 million aggregate principal amount of Notes. The Convertible 2032 Notes are general unsecured obligations of the Company. The Convertible 2032 Notes were issued pursuant to an Indenture, dated June 17, 2025, between the Company and the Trustee, as trustee.
Previous wording
See Part I, Item 1 "Notes to the Condensed Consolidated Financial Statements,"Note 5 “Debt”of our condensed consolidated financial statementsfor additional information related to the Convertible 2030 Notes and the Convertible 2032 Notes.
Current wording
See"Note 5 “Debt”, for additional information related to the Convertible 2030 Notes and the Convertible 2032 Notes.
Previous wording
During the three months ended November 1, 2025, holders exercised 4,422 Warrants, resulting in the issuance of 4,422 shares of common stock and cash proceeds of $141,504.
Current wording
During the three months ended May 2, 2026, holders exercised 1,950 Warrants, resulting in the issuance of 1,950 shares of common stock and cash proceeds of $62,400.
Previous wording
Cash provided by investing activities during the nine months ended November 2, 2024 were primarily due to proceeds from the maturity of marketable securities and proceeds from the sale of property and equipment in our Europe segment, partially offset by purchases of marketable securities and routine capital expenditures.
Current wording
Cash provided by investing activities during the three months ended May 3, 2025 was primarily due to proceeds from the maturity of Marketable securities, partially offset by purchases of Marketable securities and routine Capital expenditures.
Previous wording
Our condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and exclude certain disclosures required under GAAP for complete consolidated financial statements. Preparation of these statements requires us to make judgments and estimates. Some accounting policies have a significant impact on amounts reported in these condensed consolidated financial statements. For a summary of significant accounting policies and the means by which we develop estimates thereon, see “Part II—Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2024 Annual Report on Form 10-K. There have been no material changes to our critical accounting policies from those included in our 2024 Annual Report on Form 10-K, other than the valuation of warrants described above.
Current wording
Our condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and exclude certain disclosures required under GAAP for complete consolidated financial statements. Preparation of these statements requires us to make judgments and estimates. Some accounting policies have a significant impact on amounts reported in these condensed consolidated financial statements. For a summary of significant accounting policies and the means by which we develop estimates thereon, see “Part II—Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2025 Annual Report on Form 10-K. There have been no material changes to our critical accounting policies from those included in our 2025 Annual Report on Form 10-K, other than the valuation of Derivative asset described above.