GameStop abandons game sales focus for $56bn eBay bid
GameStop’s CEO has declared physical video game sales irrelevant as he pushes an unwanted $56 billion takeover of eBay to transform the retailer into an e-commerce giant.
Ryan Cohen, the chief executive of GameStop, has dismissed the impending death of physical video game discs as “totally, totally irrelevant” to his company’s future. Speaking on Bloomberg TV on Thursday, Cohen brushed off Sony’s recent decision to end physical disc production for new PlayStation games by 2028. His stance was blunt: “It doesn’t matter at all.”
The retailer’s underlying financials explain his detachment from the industry that built the company. In GameStop’s most recent quarter, software sales—including both physical and digital formats—accounted for just 18 percent of total revenue. The retailer has already shuttered more than 1,300 stores over its past two fiscal years as digital downloads now capture 85 percent of full-game sales on PlayStation.
Instead of video games, GameStop is currently sustained by collectibles, particularly trading cards from franchises like Pokémon, which now make up 41 percent of the business. However, Cohen used his television appearance to focus almost exclusively on a much larger corporate prize. When asked about demand signals for Grand Theft Auto VI—a title launching on November 19 that analytics firm NewZoo expects to generate over $5 billion in its first week—Cohen deflected.
“I want to go back and talk about eBay,” he said. GameStop submitted a roughly $56 billion bid for the online marketplace in May, only to be rejected by eBay’s board. Cohen remains undeterred, arguing that a combined entity could leverage substantial compatibility in physical goods and collectibles to become “a $1 trillion business.”
To pressure eBay and fund this transformation, GameStop has accumulated a stake of nearly eight percent in the target company. Cohen has also stockpiled a $9 billion cash position, generated through convertible debt and share sales during the meme-stock era.
For markets, the strategy highlights a massive execution risk. While GameStop has the cash to be a nuisance, a substantial financing gap remains to actually afford a $56 billion acquisition. Physical game sales may indeed be a dying model, but Cohen has not yet proven that his pivot to e-commerce can successfully replace the revenue it once provided.
