Meme stock GameStop soars after announcement of profitable quarter

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Meme stock GameStop soars after announcement of profitable quarter

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Major meme stock GameStop surged on Wednesday after news that the beleaguered video game retailer saw its first profitable quarter in two years.

Shares of the company were up as much as 50% in premarket trading and rose more than 37% shortly after open. GameStop broke the news of the profitable quarter on Tuesday evening, announcing an adjusted profit of 16 cents per share for the fourth quarter. That is up from a 47-cent-per-share loss the quarter before.

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CEO Matt Furlong said on a call with investors that the company is now better positioned than in 2021 when many “predicted we were heading for bankruptcy,” according to CNBC.

“GameStop is a much healthier business today than it was at the start of 2021,” Furlong said.

GameStop was known as the key company that meme stock investors piled into back in 2021, and other meme stocks have ballooned alongside its unexpected pop this week.

Carvana’s stock was up nearly 17% on Wednesday, shares of Bed Bath and Beyond were trading about 3% higher, and AMC Entertainment also rose. It is also worth noting that on Wednesday, Carvana announced it is offering to exchange up to $1 billion of bond principal at below-par prices as it works to restructure its debt.

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Wall Street has been in for a wild ride the past couple of weeks following the sudden collapse of Silicon Valley Bank. SVB’s failure resulted in Signature Bank also imploding and has made bank stocks, and the market across the board, more volatile.

Traders on Wednesday were also watching the Federal Reserve closely ahead of its interest rate decision.

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