GameStop amended its note exchange to pay about $358.4 million in cash instead of stock

Written by Claude Sonnet 5.5, an AI model, from public records. Each figure in it was checked automatically against the source's text or our database before it was published.

On Aug 31, 2026, GameStop amended its agreements to exchange about $1.4 billion of convertible notes, so that part is paid in cash instead of shares. The noteholders were to receive about 55.5 million shares, about 73% of the consideration, and about $358.4 million in cash, about 27%, which GameStop expected to fund from cash on hand. An 8-K is the report a listed company files with the SEC when something material happens; this one carried items 1.01 (a material agreement), 2.02 (results), 3.02 (an unregistered sale of shares) and 7.01 (Regulation FD disclosure).1^,2^,3^,4^,5^,6^,7

The agreements, signed on Aug 2, 2026, had the exchange settled entirely in shares, the count based in part on the volume-weighted average price over a 35-trading-day reference period that began on Aug 3. As amended, the rest of that period was terminated: the consideration for the part already elapsed was still to be settled in shares and the remaining consideration in cash, in an amount based on trading prices on the last trading day before the amendments; the company said settling in cash fixed the total number of shares issuable. The 8-K said the exchange was then expected to close on or about Sep 3, 2026; the company put what would remain outstanding afterwards at about $1.1 billion of the 2030 notes and $1.7 billion of the 2032 notes, about $2.8 billion in all.8^,9^,3^,10^,11^,12

Under item 2.02, GameStop also gave preliminary, unaudited figures for the second quarter, the 13 weeks ended Aug 1, 2026, in connection with the amendments. It expected net sales of $780 million to $800 million, against $972.2 million a year earlier; operating income of $150 million to $170 million, against $66.4 million; and net income of $290 million to $310 million, against $168.6 million. The company attributed the drop in net sales mainly to the prior-year launch of Nintendo Switch 2, planned store closures and the divestiture of its France operations.7^,13^,14^,15^,16^,17^,18

GameStop converted its derivative position related to eBay into a direct equity investment during the quarter, lowering its cash, cash equivalents and marketable securities, expected at $5.050 billion to $5.070 billion, against $8.694 billion a year earlier. As of Aug 1 it held about 43.4 million eBay shares with a fair value of about $4.947 billion; on May 3 it had submitted a non-binding proposal to acquire all of eBay at $125.00 per share in cash and stock. The expected net income included about $238 million of net gains on the eBay derivative asset and equity investment, partly offset by a loss of about $75 million on digital assets and related receivables.19^,20^,21^,22^,23

GameStop released full results on Sep 8, and its quarterly report (10-Q) filed Sep 9 reported revenue of $790.2 million, operating income of $160.2 million and net income of $298.7 million for the quarter, against $972.2 million, $66.4 million and $168.6 million a year earlier. This article rests on the Aug 31 8-K and its press releases, with GameStop's earlier eBay 8-K and its later results filings for the other facts; the amended agreements themselves are not among the documents we read.24^,25^,26^,27^,28^,29^,30^,31^,32^,6^,33