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Meme stocks have been relatively quiet in 2026. The wild Reddit-fueled rallies of 2021 feel like ancient history. But GameStop (GME) never fully faded away. Over the last few months, the company has quietly rebuilt itself. It cut costs, leaned into higher-margin collectibles, and hoarded billions in cash. Then it dropped a bombshell. GameStop reported the highest net income and operating income in its entire history.
The big news hit this week when GameStop delivered a quarter for the ages. Net income came in at $389.6 million. Operating income hit $143.3 million. Both were all-time records. Investors did not hold back. Volume spiked to three times the daily average and the stock surged 9% in a single session. This wasn’t a short-squeeze mirage. Real profits powered the move. The milestone gives the company immense credibility and proves that the relentless cost-cutting and pivot toward higher-margin categories are working.
The stock exploded higher, and suddenly the old meme flame flickered again. This time, though, the numbers actually backed up the excitement.
About GameStop Stock
GameStop is no longer just a mall-based video game retailer. It now operates a lean omnichannel platform that sells hardware, software, collectibles, and digital goods while holding a fortress-like balance sheet.
The GameStop stock’s journey tells a turnaround story. Year-to-date, shares have climbed roughly 11% after getting crushed in 2025. The rally pushed the price slightly above the 50-day moving average of $23.29 and the 200-day line $23.18. Both moving averages are now sloping higher, a classic bullish signal.
The valuation picture is less extreme than the stock’s price action suggests. GameStop's market cap is about $10 billion and its price/book ratio is 1.72x, much lower than the double digits it has hit during volatile periods. GameStop's price-to-earnings-to-growth ratio sits around 0.30x, showing that the stock is trading at a discount relative to its potential long-term growth.
GameStop Delivers Record Profits and Strong Guidance
GameStop’s fiscal first quarter showed a sharp turnaround. Net sales climbed 14% year-over-year to $835.3 million from $732.4 million, helped by collectibles, while gross profit rose to $340.3 million and operating income reached $143.3 million, the strongest first-quarter result in company history.
Net income jumped to $389.6 million from $44.8 million a year earlier. Adjusted diluted EPS was $0.30 per share, adjusted net income was $179.3 million, and free cash flow totaled $333.1 million.
The company ended the quarter with $9.7 billion in cash, marketable securities, digital assets and related receivables, plus collateral pledged for a derivative asset. It also approved a new $2 billion share repurchase authorization, replacing its prior 2019 plan.
Looking ahead, Wall Street currently expects GameStop to remain profitable in the fiscal second quarter, with consensus estimates calling for earnings of about $0.19 per share, which would be a decrease from the first quarter.
What Does Wall Street Think of GME Stock?
According to Barchart, the consensus rating sits at “Hold.” The average 12-month price target among analysts is $13.50, implying downside of 38% from recent prices. For the first time in years, the story is about profits, not memes — or is it? And that is a game-changer.
