GameStop is making ambitious plans to acquire a publicly traded consumer company that significantly exceeds its current market size, signaling a potential “transformational” shift for the video game retailer, according to CEO Ryan Cohen in a recent interview with CNBC. Cohen emphasized the enormity of the deal, stating, “It’s gonna be really big. Really big. Very, very, very big,” suggesting that the acquisition could not only redefine GameStop but also have a considerable impact within the capital markets.
While Cohen is keeping the specific targets under wraps, he outlined his criteria for the acquisition: he’s in search of an undervalued, high-quality consumer business that has scalability and growth potential, run by what he characterizes as a “sleepy management team.” He asserted that if the strategy pays off, GameStop could potentially be valued in the “several hundreds of billions of dollars” range.
However, skepticism looms over the feasibility of achieving such a monumental increase in value. Investment bankers in the consumer and retail sectors voiced doubts, suggesting that such dramatic growth in retail is rarely seen without radical changes to business models. The consensus among some professionals is that while grand ambitions are easy to articulate, executing them is a much more challenging endeavor.
This strategic expansion wasn’t birthed in isolation; it stems from GameStop’s earlier move to restructure its equity incentive model for Cohen, which is contingent on the company reaching a $100 billion market capitalization alongside $10 billion in earnings before interest, taxes, depreciation, and amortization. Should the acquisition strategy succeed and propel GameStop’s market value beyond $100 billion, Cohen stands to gain significantly, although he hopes his shareholders will benefit equally.
Since Cohen’s appointment as CEO in September 2023, he has already initiated several cost-cutting measures, enhancing the retailer’s profitability while growing its collectibles business, despite overall sales still facing challenges. Notably, during the third quarter of its fiscal 2023—when Cohen took control—GameStop reported a gross margin increase of seven percentage points and posted a net income of $77.1 million, a stark contrast to a previous loss of $3.1 million. Consecutive annual profits were recorded in fiscal years 2024 and 2025, breaking a five-year trend of losses.
GameStop’s turnaround has caught the attention of notable investors, including Michael Burry, known for his prescient investment strategies during the housing crisis. In a recent Substack post, Burry commented on Cohen’s leadership abilities, mentioning, “Ryan is making lemonade out of lemons,” praising his efforts to leverage the company’s potential amidst challenges.
In terms of funding for future acquisitions, GameStop has amassed over $9 billion in cash and marketable securities, some of which were previously allocated toward cryptocurrency investments. When questioned about the possibility of liquidating these bitcoin holdings to facilitate acquisitions, Cohen remained noncommittal but described his new strategy as “far more compelling than bitcoin.”
He draws comparisons between his vision for GameStop and Berkshire Hathaway’s long-term value creation approach, suggesting an urgency to achieve similar results in a shorter timeframe. “We can go in there and apply the Chewy and [GameStop] mindset of brutal efficiency,” Cohen stated, reinforcing his commitment to improving the profitability of targeted companies and navigating toward future acquisitions as opportunities arise.
