GameStop Corp.
For the period ended Aug 1, 2026. Filed Sep 9, 2026.
View on SEC.govAbout this filing
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.
Aug 1, 2026 · Filed Sep 9, 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 2026-05-02; filed 2026-06-11.
0001326380-26-000025
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-08-01; filed 2026-09-09.
0001326380-26-000055
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 112 previous paragraphs and 130 current paragraphs.
63 unchanged; 39 reworded; 25 added; 9 removed; 1 previous and 3 current paragraphs rearranged.
Tables are not compared: 5 previous and 6 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 (25)
Current report
Second Quarter Developments
Current report
During the quarter, our Board of Directors approved a new discretionary $2.0 billion share repurchase authorization, replacing the previous authorization then in effect. As of August 1, 2026, we had not repurchased any shares of our Class A common stock under the new authorization.
Current report
We converted our previously disclosed derivative position related to eBay Inc. ("eBay") into a direct equity investment, resulting in a decrease in cash, cash equivalents, and marketable securities. As of August 1, 2026, we held approximately 43.4 million shares of eBay common stock, par value $0.001 per share ("eBay Common Stock") with a fair value of approximately $4.9 billion. We also recorded a $75.0 million loss on Digital assets and related receivables during this quarter, reflecting a decline in the market price of Bitcoin.
Current report
Consistent with our international streamlining efforts, we completed the divestiture of our operations in France.
Current report
Beginning in the second quarter of fiscal 2026, we present Net sales in three revised product categories — Collectibles, Pre-Owned and Refurbished, and Video Games — to align with how management evaluates the business. Prior period amounts have been recast to conform to the current presentation. See Note 3, "Revenue."
Current report
Net sales decreased $182.0 million, or 18.7% for the three months ended August 1, 2026, compared to the prior year period.
Current report
During the three months ended August 1, 2026, Net sales decreased 14.2% in Australia, 16.1% in the United States, and 42.7% in Europe. The overall decrease in consolidated Net sales for the three months ended August 1, 2026 compared to the prior year period was primarily driven by a decline in Video Games sales of $231.4 million, or 46.8%, and a decline in Pre-Owned and Refurbished sales of $79.3 million or 31.7%. This was partially offset by an increase in Collectibles sales of $128.7 million or 56.5%. The declines in Video Games and in Pre-Owned and Refurbished sales were primarily due to the prior-year launch of the Nintendo Switch 2, with no such launch in the current year period; the prior year period included launch-driven hardware sales and elevated trade-in activity and pre-owned sales associated with the launch. The increase in Collectibles sales was primarily driven by continued growth in trading cards.
Current report
Net sales decreased $79.1 million, or 4.6% for the six months ended August 1, 2026, compared to the prior year period.
Current report
Gross profit increased $61.9 million, or 21.9% during the three months ended August 1, 2026, compared to the prior year period. Gross profit as a percentage of Net sales increased to 43.7%, from 29.1% in the prior year period. The increase in Gross profit and gross margin was primarily driven by a shift in sales mix towards our higher-margin product categories: sales of Collectibles increased to 45.1% of total Net sales for the three months ended August 1, 2026, compared to 23.4% in the prior year period, while sales of Video Games - which carry the lowest gross margin of our product categories, particularly new hardware - decreased to 33.3% of Net sales, compared to 50.9% in the prior year period, which included the launch of the Nintendo Switch 2.
Current report
Gross profit increased $149.4 million, or 27.9% during the six months ended August 1, 2026, compared to the prior year period.
Current report
During thesix months ended August 1, 2026, SG&A expenses decreased $58.2 million, or 13.0%, compared to the prior year period. SG&A as a percentage of Net sales decreased to 23.9% in the current year period compared to 26.2% in the prior year period.
Current report
Interest income, net decreased $2.5 million to $77.1 million for the three months ended August 1, 2026, compared to $79.6 million in the prior year period. The decrease was primarily driven by lower average Cash and cash equivalent and Marketable securities balances resulting from the investment in the eBay Common Stock during fiscal 2026.
Current report
Gain on Derivative Asset, net
Current report
During the three and six months ended August 1, 2026, we recognized Gain on derivative asset, net of $166.3 million and $434.7 million, respectively. There were no comparable amounts in the prior year periods.
Current report
For the three months ended August 1, 2026, the Loss on digital assets and related receivables was $75.0 million compared to a Gain on digital assets of $28.6 million in the prior year period.
Current report
For the six months ended August 1, 2026, the Loss on digital assets and related receivables was $73.9 million, compared to a Gain on digital assets of $28.6 million in the prior year period.
Current report
During the three and six months ended August 1, 2026, we recognized an Unrealized gain on equity investment of$72.1 million, with no comparable amounts in the prior year periods. The increase in the Unrealized gain on equity investment was due to the Company's investment in eBay Common Stock.
Current report
We recognized Income tax expense of $238.3 million for thesix months ended August 1, 2026, compared to an Income tax expense of $9.5 million for thesix months ended August 2, 2025. Our effective income tax rate was 25.7% for thesix months ended August 1, 2026 compared to 4.3% for thesix months ended August 2, 2025.
Current report
Share Authorization
Current report
On July 7, 2026, GameStop shareholders approved an amendment to the Company’s certificate of incorporation, increasing the number of authorized shares of Class A common stock from 1.0 billion to 2.5 billion.
Current report
Share Repurchase Authorization
Current report
Duringthe second quarter of fiscal 2026, the Board approved a new discretionary $2.0 billion share repurchase authorization to replace the previous share repurchase authorization. Under the new share repurchase authorization, the Company may repurchase shares of its Class A common stock from time to time in compliance with SEC regulations and other legal requirements, and subject to market conditions and other factors. The repurchase authorization does not require the Company to acquire any specific number of shares and may be terminated at any time.
Current report
Cash used in investing activities was $1,865.1 million during the six months ended August 1, 2026 compared to cash used in investing activities of $516.0 million during the six months ended August 2, 2025.
Current report
Cash used in investing activities during the six months ended August 2, 2025 was primarily due to the purchase of digital assets in the second quarter of fiscal 2025.
Current report
All Put/Call Pairs were exercised and settled during the second quarter of fiscal 2026, and no Derivative asset remained on the Company's condensed consolidated balance sheets as of August 1, 2026. During the three andsix months ended August 1,
Removed paragraphs (9)
Previous report
Subsequent to the end of the first quarter of fiscal 2026, the Company announced a non-binding proposal to acquire eBay Inc.
Previous report
First Quarter Developments
Previous 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.
Previous 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.
Previous 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.
Previous 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.
Previous report
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 report
Cash provided by investing activities was $742.9 million during the three months ended May 2, 2026 compared to $7.3 million during the three months ended May 3, 2025.
Previous report
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.
Reworded paragraphs (39)
Previous wording
The following discussion should be read in conjunction with the information contained in our condensed consolidated financial statements, including the notes thereto set forth in Part I, Item 1 of this Form 10-Q. Statements regarding future economic performance, management’s plans and objectives, and any statements concerning assumptions related to the foregoing contained in Management’s Discussion and Analysis of Financial Condition and Results of Operations constitute forward-looking statements. These statements are only predictions based on current expectations and assumptions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. All forward-looking statements included in this Form 10-Q are based upon information available to us as of the filing date of this Form 10-Q, and we undertake no obligation to update or revise any of these forward-looking statements for any reason, whether as a result of new information, future events or otherwise after the date of this Form 10-Q, except as required by law. You should not place undue reliance on these forward-looking statements. The forward-looking statements involve a number of risks and uncertainties. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Certain factors, which may cause actual results to vary materially from these forward-looking statements, accompany such statements and are discussed in our 2025 Annual Report on Form 10-K, including the disclosures under Part I, Item 1A "Risk Factors."
Current wording
The following discussion should be read in conjunction with the information contained in our condensed consolidated financial statements, including the notes thereto set forth in Part I, Item 1 of this Form 10-Q. Statements regarding future economic performance, management’s plans and objectives, and any statements concerning assumptions related to the foregoing contained in Management’s Discussion and Analysis of Financial Condition and Results of Operations constitute forward-looking statements. These statements are only predictions based on current expectations and assumptions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. All forward-looking statements included in this Form 10-Q are based upon information available to us as of the filing date of this Form 10-Q, and we undertake no obligation to update or revise any of these forward-looking statements for any reason, whether as a result of new information, future events or otherwise after the date of this Form 10-Q, except as required by law. You should not place undue reliance on these forward-looking statements. The forward-looking statements involve a number of risks and uncertainties. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Certain factors, which may cause actual results to vary materially from these forward-looking statements, accompany such statements and are discussed in our 2025 Annual Report on Form 10-K for the year ended January 31, 2026 (the “2025 Annual Report on Form 10-K”), including the disclosures under Part I, Item 1A "Risk Factors."
Previous 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.
Current wording
Investments are made in accordance with the guidelines of an Investment Policy that is reviewed at least annually by the Company’s Board of Directors (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
•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.
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 they place the personal resources of such directors at risk in substantially the same manner as resources of the Company.
Previous wording
•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.
Current wording
•Strategic Validation: Our recent initiatives support our view 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.
Previous wording
•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 wording
•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, Canada and France.
Previous wording
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 wording
During the second quarter of fiscal 2026, we continued to advance the strategic priorities we pursued throughout fiscal 2025 and the first quarter of fiscal 2026.
Previous wording
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 wording
Consistent with our focus on the growth of collectibles, we continued to expand store space and roll out new fixtures dedicated to the category to support in-store collectibles sales. As a result of our efforts in this area, our Collectibles product category increased to 45.1% of our Net Sales in the second quarter of fiscal 2026 compared to 23.4% in the second quarter of fiscal 2025.
Previous wording
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 wording
Our balance sheet continued to reflect the proceeds of our 0.00% Convertible Senior Notes due 2030 (the “2030 Notes”) and 0.00% Convertible Senior Notes due 2032 (the “2032 Notes”, and together with the 2030 Notes, the “Convertible Notes”), and our Bitcoin treasury reserve holdings and related receivables. Total Cash, cash equivalents, Marketable securities, Digital assets and related receivables were $5,354.4 million as of August 1, 2026. This total included$4,854.3 million of Cash and cash equivalents,$206.0 million of Marketable securities, and approximately$294.1 million in Digital assets and related receivables.
Previous wording
The Three Months Ended May 2, 2026 Compared to the Three Months Ended May 3, 2025
Current wording
The Three and Six Months Ended August 1, 2026 Compared to the Three and Six Months Ended August 2, 2025
Previous wording
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 wording
During the six months ended August 1, 2026, Net sales decreased 19.7% in Europe, 1.0% in Australia, 0.2% in the United States and 100.0% in Canada. The decline in the Canada segment reflects the divestiture of that business in the second quarter of fiscal 2025. The overall decrease in consolidated Net sales for the six months ended August 1, 2026 compared to the prior year period was primarily driven by a decrease in Video Games sales of $295.0 million or 34.9%, and a decrease in Pre-Owned and Refurbished sales of $50.2 million or 11.9%. This was partially offset by an increase in collectible sales of $266.1 million or 60.6%. The decline in Video Game sales was primarily due to the prior-year launch of the Nintendo Switch 2, with no such launch in the current year period.
Previous wording
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 wording
Gross profit as a percentage of Net sales increased to 42.2%, from 31.4% in the prior year period. The increase in Gross profit and gross margin was primarily driven by a shift in sales mix towards our higher-margin product categories: sales of Collectibles increased to 43.4% of Net sales for the six months ended August 1, 2026, compared to 25.8% in the prior year period, while sales of Video Games decreased to 33.8% of Net sales, compared to 49.6% in the prior year period.
Previous 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.
Current wording
During the three months ended August 1, 2026, Selling, general, and administrative ("SG&A") expenses decreased $31.7 million, or 14.5%, compared to the prior year period. SG&A as a percentage of Net sales increased to 23.7% in the current year period compared to 22.5% in the prior year period.
Previous wording
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 wording
The reduction in SG&A expenses for the six months ended August 1, 2026 was primarily driven by a$38.4 million decrease in store-related rent and occupancy costs, due to store closures and international divestitures completed in recent periods. In addition, labor-related costs, consulting services and marketing expenses decreased$20.8 million as part of our ongoing cost-optimization initiatives.
Previous 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.
Current wording
During the six months ended August 1, 2026, Asset impairment wasa benefit of $6.9 million, compared to an expense of$33.4 million in the prior year period. As a percentage of Net sales, the net impairment benefit was 0.4% during the current year period, compared to expense of 2.0% in the prior year period. 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 half of fiscal 2025, and the divestiture was completed during the second quarter of fiscal 2025. We recorded $15.1 million of impairment expense related to the French disposal group in the first half of fiscal 2025, and the divestiture was completed during the second quarter of fiscal 2026.
Previous wording
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 wording
Interest income, net increased $24.3 million to $160.8 million for thesix months ended August 1, 2026, compared to $136.5 million in the prior year period. The increase was primarily driven by higher average Cash and cash equivalent, and Marketable securities balances resulting from the issuance of the Convertible Notes.
Previous wording
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 wording
The increase in the Gain on derivative asset, net for the three and six months ended August 1, 2026 was due to the Company entering into the Put/Call Pairs during the first half of fiscal 2026 that provided economic exposure to the eBay Common Stock.
Previous wording
Gain on Digital Assets and Related Receivables
Current wording
Loss (Gain) on Digital Assets and Related Receivables
Previous wording
Unrealized Gain on Derivative Asset, net
Current wording
Unrealized Gain on Equity Investment
Previous 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.
Current wording
We recognized Income tax expense of $121.5 million for the three months ended August 1, 2026, compared to an Income tax expense of $6.0 million for the three months ended August 2, 2025. Our effective income tax rate was 28.9% for the three months ended August 1, 2026 compared to 3.4% for the three months ended August 2, 2025.
Previous wording
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 wording
The increase in income tax expense was driven primarily by significantly higher pre-tax income for the three and six months ended August 1, 2026, compared to the three and six months ended August 2, 2025. The increase in the effective tax rate reflects that the prior-year period benefited from the utilization of U.S. net operating loss carryforwards and the related release of valuation allowances, which were substantially exhausted by the end of fiscal 2025. The difference between our effective tax rates and the statutory income tax rates in the current periods is primarily attributable to state income taxes and losses for which no corresponding tax benefit was recognized.
Previous 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.
Current wording
Our principal sources of liquidity are cash on hand and cash from operations. As of August 1, 2026, we had$4,854.3 million of unrestricted Cash and cash equivalents, and $206.0 million of Marketable securities.
Previous 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.
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 August 1, 2026,$206.0 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 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 wording
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 August 1, 2026, the divestiture of the French disposal group was completed. See Note 9, "Assets Held for Sale," for additional information.
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 May 2, 2026, we had letters of credit and other bank guarantees outstanding in the amount of$7.2 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 August 1, 2026, we had letters of credit and other bank guarantees outstanding in the amount of$4.6 million.
Previous wording
In the first quarter of fiscal 2025, we announced that the Board approved the addition of Bitcoin as a treasury reserve asset, allowing a portion of our cash or future debt and equity proceeds to be invested in Bitcoin. During the second quarter of fiscal 2025, we purchased 4,710 Bitcoin for $500 million. In the fourth quarter of fiscal 2025, we entered into an agreement (the "Collateral Agreement") with Coinbase Credit, Inc. (the "counterparty"), under which we sold covered call options on a portion of the Bitcoin we own. In connection with this covered-call strategy, we pledged 4,709 Bitcoin (the "Pledged Bitcoin") as collateral.
Current wording
In the first quarter of fiscal 2025, we announced that the Board approved the addition of Bitcoin as a treasury reserve asset, allowing a portion of our cash or future debt and equity proceeds to be invested in Bitcoin. During the second quarter of fiscal 2025, we purchased 4,710 Bitcoin for $500 million. In the fourth quarter of fiscal 2025, we entered into an agreement (the "Collateral Agreement") with Coinbase Credit, Inc. ("Coinbase"), under which we sold covered call options on a portion of the Bitcoin we own. In connection with this covered-call strategy, we pledged 4,709 Bitcoin (the "Pledged Bitcoin") as collateral.
Previous wording
Under the terms of the Collateral Agreement, the counterparty retained the right to rehypothecate, commingle, or unilaterally sell the Pledged Bitcoin. As a result of these rights, we concluded that control of the Pledged Bitcoin transferred to the counterparty. Accordingly, we derecognized the Pledged Bitcoin as an Intangible asset and recognized Digital assets receivable within Digital assets and related receivables on our condensed consolidated balance sheets representing our contractual right to receive equivalent amount of Bitcoin in the future. Although the classification of these assets has changed, our economic exposure is consistent with direct ownership of the underlying Bitcoin.
Current wording
Under the terms of the Collateral Agreement, Coinbase retained the right to rehypothecate, commingle, or unilaterally sell the Pledged Bitcoin. As a result of these rights, we concluded that control of the Pledged Bitcoin transferred to Coinbase. Accordingly, during the fourth quarter of fiscal 2025, we derecognized the Pledged Bitcoin as an Intangible asset and recognized Digital assets receivable within Digital assets and related receivables on our condensed consolidated balance sheets representing our contractual right to receive equivalent amount of Bitcoin in the future. The Digital assets receivable is presented within Digital assets and related receivables on the condensed consolidated balance sheets as of both August 1, 2026 and January 31, 2026, and remains subject to the Collateral Agreement. Although the classification of these assets has changed, our economic exposure is consistent with direct ownership of the underlying Bitcoin, except to the extent of the covered call options written on a portion of those holdings.
Previous wording
We recorded a gain of$1.1 million related to the Digital asset receivable during the first quarter of fiscal 2026, reflecting the increase in the market price of Bitcoin during the period.
Current wording
We recorded a loss of$75.0 million and$73.9 million related to the Digital asset receivable during the three and six months ended August 1, 2026, respectively, reflecting the decrease in the market price of Bitcoin during the periods.
Previous wording
On May 17, 2024, we entered into an Open Market Sale Agreement SM(the “Sales Agreement”) with Jefferies LLC (the “Sales Agent”) providing for the sale by the Company of shares of our Class A common stock, par value $0.001 per share (“Common Shares”), from time to time, through the Sales Agent in connection with an “at-the-market offering” program (the “ATM Offering”).
Current wording
On May 17, 2024, we entered into an Open Market Sale Agreement SM(the “Sales Agreement”) with Jefferies LLC (the “Sales Agent”) providing for the sale by the Company of shares of our Class A common stock, from time to time, through the Sales Agent in connection with an “at-the-market offering” program (the “ATM Offering”). No shares of Common Stock were sold under the ATM Offering during the six months ended August 1, 2026.
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 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.
Current wording
On April 1, 2025, we completed a private offering of $1,500 million aggregate principal amount of 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 2030 Notes. The 2030 Notes are general unsecured obligations of the Company. The 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 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.
Current wording
On June 17, 2025, we completed a private offering of $2,250 million aggregate principal of the 2032 Notes, plus the exercise of the option by the initial purchaser of the 2032 Notes to purchase up to an additional $450 million aggregate principal amount of 2032 Notes. The 2032 Notes are general unsecured obligations of the Company. The 2032 Notes were issued pursuant to an Indenture, dated June 17, 2025, between the Company and the Trustee, as trustee.
Previous wording
See"Note 5 “Debt”, for additional information related to the Convertible 2030 Notes and the Convertible 2032 Notes.
Current wording
See Note 5 “Debt” and Note 15"Subsequent Events" for additional information related to the Convertible Notes.
Previous wording
Pursuant to the terms of the Warrant Agreement between the Company, Computershare Inc., a Delaware corporation, and its affiliate, Computershare Trust Company, N.A., as Warrant Agent (the “Warrant Agreement”), each holder of record of Common Stock as of the Record Date received one Warrant for every ten shares of Common Stock (rounded down to the nearest whole number for any fractional Warrant). Holders of the Convertible Notes also received Warrants on an “as converted” basis in lieu of an adjustment to the conversion rate of the Convertible Notes pursuant to the applicable indenture governing the Convertible Notes. The distribution of the Warrants to the Convertible Noteholders was at the same time and on the same terms as holders of Common Stock. Holders of the Convertible Notes will not need to convert the Convertible Notes into Common Stock in order to receive the Warrants.
Current wording
Pursuant to the terms of the Warrant Agreement between the Company, Computershare Inc., a Delaware corporation, and its affiliate, Computershare Trust Company, N.A., as Warrant Agent (the “Warrant Agreement”), each holder of record of Common Stock as of the Record Date received one Warrant for every ten shares of Common Stock (rounded down to the nearest whole number for any fractional Warrant). Holders of the Convertible Notes also received Warrants on an “as converted” basis in lieu of an adjustment to the conversion rate of the Convertible Notes pursuant to the applicable indenture governing the Convertible Notes. The distribution of the Warrants to the Convertible Noteholders was at the same time and on the same terms as holders of Common Stock. Holders of the Convertible Notes were not required to convert the Convertible Notes into Common Stock in order to receive the Warrants.
Previous 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.
Current wording
During the six months ended August 1, 2026, holders exercised 2,534 Warrants, resulting in the issuance of 2,534 shares of common stock and cash proceeds of $0.1 million.
Previous wording
Cash provided by oper ating activities was$337.4 million during the three months ended May 2, 2026, compared to $192.5 million during the three months ended May 3, 2025. The increase was primarily driven by higher operating income and increased interest income during the current year period.
Current wording
Cash provided by oper ating activities was$399.8 million during the six months ended August 1, 2026, compared to $309.9 million during the six months ended August 2, 2025. The increase was primarily driven by higher operating income and increased interest income during the current year period.
Previous wording
Cash provided by investing activities during the three months ended May 2, 2026 was primarily due to the proceeds from the sales and maturities of Marketable securities, partially offset by cash pledged as collateral in connection with the Derivative asset.
Current wording
Cash used in investing activities during the six months ended August 1, 2026 was primarily driven by the equity investment in eBay, partially offset by proceeds from the sales and maturities of marketable securities.
Previous wording
Cash provided by fina ncing activities was $1.5 million during the three months ended May 2, 2026 compared to $1,478.0 million during the three months ended May 3, 2025. The decrease primarily reflects gross proceeds of$1.5 billion received from the issuance of the 2030 Convertible Notes in the prior year period, with no comparable financing activity in the current year period.
Current wording
Cash provided by fina ncing activities was $0.1 million during the six months ended August 1, 2026, compared to $4,153.3 million during the six months ended August 2, 2025. The decrease was primarily due to $4.2 billion of gross proceeds received from the issuance of the Convertible Notes in the prior-year period, with no comparable financing activity in the current-year period.
Previous wording
During the first quarter of fiscal 2026, the Company recognized a Derivative asset that provides economic exposure to 22,176,000 shares of eBay Inc. (“eBay”) common stock, par value $0.001 per share. This exposure results from a series of paired put and call option transactions (the “Put/Call Pairs”) entered into during the quarter. Each Put/Call Pair is structured as a combination of non-transferable embedded purchased call option and non-transferable embedded written put option entered into contemporaneously with the same counterparty scheduled to expire on February 23, 2028.
Current wording
During the first half of fiscal 2026, the Company recognized a Derivative asset that provided economic exposure to 39,046,658 shares of eBay Common Stock. This exposure resulted from a series of paired put and call option transactions (the “Put/Call Pairs”) entered into during the first half of fiscal 2026. Each Put/Call Pair was structured as a combination of non-transferable embedded purchased call option and non-transferable embedded written put option entered into contemporaneously with the same counterparty.
Previous wording
As of May 2, 2026, the Company’s condensed consolidated balance sheets reflect a Derivative asset of$285.3 million. During three months ended May 2, 2026, the Company recognized an Unrealized gain on derivative asset, net of$268.4 million, net of certain transaction-related costs, in its condensed consolidated statements of operations.
Current wording
2026, the Company recognized a Gain on derivative asset, net of$166.3 million and $434.7 million, respectively. net of certain transaction-related costs,in its condensed consolidated statements of operations.
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 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.
Current wording
Our condensed consolidated financial statements have been prepared in accordance with 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.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
(1) "NM" identifies data that is not meaningful.
Current report — wording carried from elsewhere
The reduction in SG&A for the three months ended August 1, 2026 was primarily driven by an $18.5 million decrease in store-related rent and occupancy costs due to store closures and international divestitures completed in such period. In addition, labor-related costs, consulting services and marketing expenses decreased$11.4 millionas part of our ongoing cost-optimization initiatives during the three months ended August 1, 2026.
Current report — wording carried from elsewhere
During the three months ended August 1, 2026, Asset impairment was a benefit of $2.3 million, compared to a benefit of $2.1 million in the prior year period. As a percentage of Net sales, the net impairment benefit was 0.3% during the current year period, compared to 0.2% in the prior year period. The change was attributable to management's plan, approved in the first quarter of fiscal 2025, to divest the Company's operations in France, resulting in the reclassification of the related assets and liabilities as held for sale. The divestiture was completed during the second quarter of fiscal 2026.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
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.