Financial Analysis

Commitments and Contingencies Commitments As of May 2, 2026, we had approx imately $7.2 million of o utstanding stand-by letters of credit and other bank guarantees supporte d by $6.0 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 May 2, 2026, May 3, 2025 and January 31, 2026, there was $4,166.1 million, $1,480.7 million and $4,164.3 million of outstanding debt, respectively. In addition, $8.9 million, $11.4 million and $7.5 million of debt associated with the French disposal group was classified as current and included in Liabilities held for sale in the condensed consolidated balance sheets as of those dates. Convertible Senior Notes Convertible 2030 Notes On April 1, 2025, we completed a private offering of $1,500.0 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 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 (the ""2030 Indenture""), between the Company and U.S. Bank Trust Company, National Association, as trustee (the Trustee). As of May 2, 2026 , the balance of the Convertible 2030 Notes, net of debt issuance costs of $15.4 million was $1,484.6 million. The Company determines the fair value of its Convertible 2030 Notes in accordance with ASC 820, Fair Value Measurement , using observable market inputs on a secondary market exchange (Level 2 input). As of May 2, 2026, the fair value of the Convertible 2030 Notes was approximately $1,675.4 million. Convertible 2032 Notes On June 17, 2025, w …

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The following table presents Net sales by significant product category: Three Months Ended May 2, 2026 May 3, 2025 Hardware and accessories (1) $ 333.7 $ 345.3 Software (2) 152.7 175.6 Collectibles (3) 348.9 211.5 Total Net sales $ 835.3 $ 732.4 __________________________________________________ (1) Includes sales of new and pre-owned hardware, accessories, hardware bundles in which hardware and digital or physical software are sold together in a single SKU, interactive game figures, strategy guides, mobile and consumer electronics. (2) Includes sales of new and pre-owned gaming software, digital software, and PC entertainment software. (3) Includes the sale of apparel, toys, trading cards, gadgets, other retail products for pop culture and technology enthusiasts, and submission services for the authentication and grading of trading cards.

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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 assets and liabilities, 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 and digital assets based on quoted prices in active markets for identical assets. Other marketabl …

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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 three months ended May 2, 2026. We recognized income tax expense of $116.8 million for the three months ended May 2, 2026, representing an effective tax rate of 23.1% , compared to income tax expense of $3.5 million, or an effective tax rate of 7.2% , for the three months ended May 3, 2025. The increase in income tax expense was driven primarily by significantly higher pre-tax income for the three months ended May 2, 2026 The increase in the effective 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. On July 4, 2025, the One Big Beautiful Bill Act (""OBBBA"") was enacted in the United States. The legislation makes permanent certain expiring provisions of the Tax Cuts and Jobs Act, modifies the U.S. international tax framework, and restores certain favorable business tax provisions. The OBBBA's provisions take effect on various dates between 2025 and 2027. The Company has evaluated the legislation and does not expect it to have a material impact on its estimated fiscal 20 …

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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. 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 either a prospective or a retrospective approach. Early adoption is permitted. We are curr …

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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 fiscal 2024, 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 were not material, individually or in the aggregate, during the first quarters of fiscal 2026 and 2025."

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"Revenue The following table presents Net sales by significant product category: Three Months Ended May 2, 2026 May 3, 2025 Hardware and accessories (1) $ 333.7 $ 345.3 Software (2) 152.7 175.6 Collectibles (3) 348.9 211.5 Total Net sales $ 835.3 $ 732.4 __________________________________________________ (1) Includes sales of new and pre-owned hardware, accessories, hardware bundles in which hardware and digital or physical software are sold together in a single SKU, interactive game figures, strategy guides, mobile and consumer electronics. (2) Includes sales of new and pre-owned gaming software, digital software, and PC entertainment software. (3) Includes the sale of apparel, toys, trading cards, gadgets, other retail products for pop culture and technology enthusiasts, and submission services for the authentication and grading of trading cards. See Note 8, ""Segment Information,"" for Net sales by geographic location. Performance Obligations We have arrangements with customers where our performance obligations are satisfied over time, which primarily relate to extended warranties and our GameStop Pro rewards program. We expect to recognize revenue in future periods for remaining performance obligations we have associated with unredeemed gift cards, trade-in credits, reservation deposits and loyalty points earned as part of our GameStop Pro rewards program (collectively, ""unredeemed customer liabilities""), extended warranties, and subscriptions to our GameStop Pro reward …

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Segment Information We operate our business 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. 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 the prior fiscal year, and are not included in the current fiscal year. 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 the prior fiscal year. Current year segment results for Europe include retail and ecommerce operations in France. Segment results for Europe also previously included retail operations in Italy, Germany, Austria, Ireland and Switzerland. Our chief operating decision makers (CODM) are our Chief Executive Officer and our Principal Financial and Accounting Officer, who have responsibility for allocating resources and assessing performance for …

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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 2025 Annual Report on Form 10-K. Cash, Cash Equivalents and Restricted Cash 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 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: May 2, 2026 May 3, 2025 January 31, 2026 Cash and cash equivalents $ 7,397.6 $ 6,385.8 $ 6,304.7 Restricted cash (1) 3.6 3.5 3.7 Long-term restricted cash (2) 10.6 34.8 19.7 Total cash, cash equivalents and restricted cash $ 7,411.8 $ 6,424.1 $ 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 consolidated balance sheets …

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Subsequent Events On May 3, 2026, the Company submitted a non-binding proposal (the Proposal) to acquire 100% of the outstanding shares of eBay for $125.00 per share in a combination of cash and stock. On May 12, 2026, eBay rejected the Proposal. Consummation of the Proposal was subject to customary closing conditions, including approval by the shareholders of both the Company and eBay, as well as the receipt of required antitrust approvals. There can be no assurance that the Company will enter into a binding agreement with respect to an acquisition of Ebay, on terms favorable to the Company, or at all. On May 4, 2026, the Company filed a Schedule 13D with the Securities and Exchange Commission reporting its combined beneficial ownership of, and economic exposure to, eBay, consisting of direct beneficial ownership of 25,000 shares of eBay Common Stock and derivative exposure to 22,176,000 additional shares through a series of American-style put and call option transactions expiring February 23, 2028 (as further described in Note 10). On May 19, 2026, the Company filed Amendment No. 1 to the Schedule 13D, reflecting an increase in its derivative exposure to 29,078,699 shares of eBay Common Stock. On May 28, 2026, the Company filed Amendment No. 2 to the Schedule 13D, reflecting a further increase in its derivative exposure to 34,508,990 shares of eBay Common Stock. On June 5, 2026, the Company filed Amendment No. 3 to the Schedule 13D (the Amendment No. 3) disclosing (i) the a …

SubsequentEventsTextBlock · excerpt; the full note is in the filing