Financial Analysis

Commitments and Contingencies Commitments As of August 1, 2026, we had approx imately $4.6 million of o utstanding stand-by letters of credit and other bank guarantees supporte d by $4.6 million of cash collateral that is included in restricted cash. Legal Proceedings In the ordinary course of business, we are, from time to time, subject to various legal proceedings, including matters involving wage and hour employee class actions, stockholder actions, and consumer class actions, violent acts, and other conflicts. We may enter into discussions regarding settlement of these and other types of lawsuits, and may enter into settlement agreements, if we believe settlement is in the best interest of our stockholders. We do not believe that any such existing legal proceedings or settlements, individually or in the aggregate, will have a material effect on our financial condition, results of operations or liquidity.

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"Debt As of August 1, 2026, August 2, 2025 and January 31, 2026, there was $4,167.8 million, $4,160.9 million and $4,164.3 million of outstanding debt, respectively. Convertible Senior Notes Convertible 2030 Notes On April 1, 2025, we completed a private offering of $1,500.0 million aggregate principal amount of our 0.00% Convertible Senior Notes due 2030 Notes (the ""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, as trustee (the Trustee). As of August 1, 2026 , the balance of the 2030 Notes, net of debt issuance costs of $14.4 million was $1,485.6 million. The Company determines the fair value of its 2030 Notes in accordance with ASC 820, Fair Value Measurement , using observable market inputs on a secondary market exchange (Level 2 input). As of August 1, 2026, the fair value of the 2030 Notes was approximately $1,509.8 million. Convertible 2032 Notes On June 17, 2025, we completed a private offering of $2,250.0 million aggregate principal amount of our 0.00% Convertible Senior Notes due 2032 (the ""2032 Notes"", and together with the 2030 Notes, the Convertible Notes), plus the exercise in full of the initial purchasers option to purchase up to …

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The following table presents Net sales by significant product category: Three Months Ended Six Months Ended August 1, 2026 August 2, 2025 August 1, 2026 August 2, 2025 Collectibles (1) $ 356.3 $ 227.6 $ 705.2 $ 439.1 Video Games (2) 263.2 494.6 549.8 844.8 Pre-Owned and Refurbished (3) 170.7 250.0 370.5 420.7 Total Net sales $ 790.2 $ 972.2 $ 1,625.5 $ 1,704.6 __________________________________________________ (1) Includes new and pre-owned trading cards and other collectible products; action figures, statues, replicas and other figures; apparel; plush, board games, building sets, and other toys; home goods; and other retail products for collectors and enthusiasts of gaming, entertainment and pop culture; and fees earned from facilitating the submission of customers' trading cards to a third-party authentication and grading service. Collectible products are classified in this category based on the nature of the product, irrespective of whether the product is new or pre-owned. (2) Includes new video game hardware, accessories, and software (both physical and digital); digital currency, including platform points and gift cards redeemable for digital games and content; PC gaming products; and extended product warranties sold on new products. (3) Includes pre-owned and refurbished video game hardware, physical video game software, accessories, and consumer electronics, acquired primarily through our customer trade-in programs and extended product warranties sold on pre-owned prod …

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"Fair Value Measurements Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Applicable accounting standards require disclosures that categorize assets and liabilities measured at fair value into one of three different levels depending on the observability of the inputs employed in the measurement. Each fair value measurement is reported in one of the following three levels: Level 1 inputs are quoted prices in active markets for identical assets or liabilities; Level 2 inputs are observable inputs other than quoted prices included in Level 1 for the asset or liability, either directly or indirectly through market-corroborated inputs; and Level 3 inputs are unobservable inputs for the asset or liability reflecting our assumptions about pricing by market participants. Assets and Liabilities that Are Measured at Fair Value on a Recurring Basis Assets and liabilities that are measured at fair value on a recurring basis include our cash equivalents, marketable securities, digital assets, digital assets receivable, derivative liabilities, equity investments, company-owned life insurance policies with a cash surrender value, and certain nonqualified deferred compensation liabilities. We measure the fair value of cash equivalents, certain marketable securities, equity investments and digital assets based on Level 1 inputs using quoted prices in ac …

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"Income Taxes Our interim tax provision was determined using an estimated annual effective tax rate (""AETR"") applied to ordinary pre-tax income, adjusted for the tax effects of discrete items recognized during the six months ended August 1, 2026. We recognized income tax expense of $121.5 million for the three months ended August 1, 2026, representing an effective tax rate of 28.9% , compared to income tax expense of $6.0 million , or an effective tax rate of 3.4%, for the three months ended August 2, 2025. The increase in income tax expense was driven primarily by significantly higher pre-tax income for the three months ended August 1, 2026. 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 rate and the U.S. federal statutory rate of 21% is primarily attributable to state income taxes and losses for which no corresponding tax benefit was recognized. We recognized income tax expense of $238.3 million for the six months ended August 1, 2026 , representing an effective tax rate of 25.7%, compared to income tax expense of $9.5 million, or an effective tax rate of 4.3% , for the six months ended August 2, 2025 . The increase in income tax expense was driven primarily by significantly higher pre-tax income for the six months ended Aug …

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"Recently issued accounting pronouncements not yet adopted In November 2024, the FASB issued ASU No. 2024-03, ""Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses"", as clarified by ASU No. 2025-01, ""Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosure (Subtopic 220-40); Clarifying the Effective Date."" (collectively, 'ASU No. 2024-03'). The guidance includes amendments to require public companies to provide additional disaggregated information about certain costs and expenses in a tabular format. The ASU is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of this standard will have on the Companys condensed consolidated financial statements and expects to provide additional disclosures upon adoption of this standard. In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. The ASU clarifies interim disclosure requirements and the applicability of Topic 270. The objective of the amendments is to provide further clarity about the current interim disclosure requirements. The ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Adoption of this ASU can be applied using either …

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"Related Party Transactions One of the Company's directors, Nat Turner, also serves as the Chairman and Chief Executive Officer of Collectors Holdings, Inc. (""Collectors""), the parent company of Professional Sports Authenticator (""PSA""). As a result, Collectors and PSA are considered related parties under ASC 850, Related Party Disclosures. During the third quarter of the fiscal year ended February 1, 2025, the Company announced that it had entered into a collaboration with Collectors through its PSA division. Under this arrangement, the Company became an authorized PSA dealer, and PSA provides authentication and grading services for trading cards through select GameStop stores across the United States. During the second quarter of fiscal 2025, the Company launched Power Packs, a digital trading card platform developed in collaboration with PSA. Transactions with Collectors and PSA we re not mate rial, individually or in the aggregate, during the first two quarters of fiscal 2026 and 2025."

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"Revenue During the second quarter of fiscal 2026, we revised the significant product categories used to disaggregate Net sales to Collectibles, Pre-Owned and Refurbished, and Video Games. The significant categories previously used to disaggregate Net sales were Hardware and accessories, Software, and Collectibles. The revised categories reflect changes in the composition of our business and align the disclosure with how management currently evaluates sales performance. Consumer engagement has shifted toward collectibles and trading cards, which now represent our largest product category. Our pre-owned and refurbished products sourced primarily through customer trade-ins and including products we repair or refurbish prior to resale carry economics distinct from sales of new product, and were previously presented within two separate categories. In addition, an increasing proportion of software spending is fulfilled through digital delivery channels, which has narrowed the distinction between the previous Hardware and accessories and Software categories. The change in presentation had no effect on total Net sales, results of operations, financial position, or reportable segments. Prior period amounts have been recast to conform to the current period presentation. The following table presents Net sales by significant product category: Three Months Ended Six Months Ended August 1, 2026 August 2, 2025 August 1, 2026 August 2, 2025 Collectibles (1) $ 356.3 $ 227.6 $ 705.2 $ 439.1 V …

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Segment Information Effective July 8, 2026, we operate our business in two geogr aphic segments: United States and Australia. During the second quarter of fiscal 2026, we divested our operations in France, which represented our remaining operating entity in Europe, and previously comprised a third separate reporting segment. During the second quarter of fiscal 2025, we divested our operations in Canada, which previously comprised a fourth separate reporting segment. We identified segments ba sed on a combination of geographic areas and management responsibility. Segment results for the United States include retail operations in 50 states; our ecommerce website www.gamestop.com; and our GameStop Pro loyalty program. The United States segment also includes general and administrative expenses related to our corporate offices in Grapevine, Texas. Segment results for Canada reflect retail and ecommerce operations previously conducted in Canada, which were divested during the second quarter of fiscal 2025. Segment results for Australia include retail and ecommerce operations in Australia. These results also previously included operations in New Zealand, which were closed during the fourth quarter of fiscal 2025. Current year segment results for Europe include retail and ecommerce operations previously conducted in France, which were divested during the second quarter of fiscal 2026. Segment results for Europe also previously included retail operations in Italy, Germany, Austria, Ir …

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"Summary of Significant Accounting Policies Included below are certain updates related to policies included in Part II, Item 8 ""Notes to Consolidated Financial Statements,"" Note 2 , ""Summary of Significant Accounting Policies,"" in the Annual Report on Form 10-K for fiscal 2025. Cash, Cash Equivalents and Restricted Cash 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 an original maturity of 90 days or less. Our Restricted cash is also carried at cost, which approximates fair value, and consists primarily of bank deposits that collateralize our obligations to vendors and landlords. The following table presents a reconciliation of Cash and cash equivalents and Restricted cash in our condensed consolidated balance sheets to total Cash and cash equivalents and Restricted cash in our condensed consolidated statements of cash flows: August 1, 2026 August 2, 2025 January 31, 2026 Cash and cash equivalents $ 4,854.3 $ 8,694.4 $ 6,304.7 Restricted cash (1) 3.2 3.5 3.7 Long-term restricted cash (2) 10.8 36.0 19.7 Total cash, cash equivalents and restricted cash $ 4,868.3 $ 8,733.9 $ 6,328.1 _________________________________________________ (1) Recognized in Prepaid expenses and other current assets on our condensed consolidated balance sheets. (2) Recognized in Other noncurrent assets on our condensed consolida …

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Share Repurchase Program During the 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. The new share repurchase authorization expires on June 2, 2029. As of August 1, 2026, the Company had not repurchased any of its shares of Class A common stock under the program.

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Subsequent Events On August 2, 2026, the Company entered into (i) privately negotiated exchange agreements (the 2030 Notes Exchange Agreements) with a limited number of existing holders (the 2030 Existing Noteholders) of its 2030 Notes, and (ii) privately negotiated exchange agreements (the 2032 Notes Exchange Agreements and, together with the 2030 Notes Exchange Agreements, the Exchange Agreements) with a limited number of existing holders (the 2032 Existing Noteholders and, together with the 2030 Existing Noteholders, the Existing Noteholders) of its 2032 Notes, in each case relating to the exchange (the Exchange) of such 2030 Notes and 2032 Notes held by the Existing Noteholders for shares of the Companys Class A common stock. Pursuant to the Exchange Agreements, the Company agreed to exchange approximately (i) $400 million aggregate principal amount of the outstanding 2030 Notes, and (ii) $1.0 billion aggregate principal amount of the outstanding 2032 Notes (collectively, the Exchange Notes) held by the Existing Noteholders. On August 31, 2026, the Company entered into amendments to each of the Exchange Agreements (the Amendments). As originally structured, the Exchange was to be settled entirely in shares of Class A common stock, with the number of shares based in part on the volume-weighted average price of the Class A common stock over a 35 trading day reference period that began on August 3, 2026 (the Reference Period). As amended, the remainder of the Reference Perio …

SubsequentEventsTextBlock · excerpt; the full note is in the filing