GameStop is a T-Bill fund cosplaying as a retailer

GameStop is ostensibly in the business of selling video games and other collectibles. That business is not good!

The company’s second quarter results showed they lost $22 million dollars doing that for the three months ending August 3. Not stellar, but an improvement over the nearly $55 million in operating losses in the previous quarter.

But the business of having money and sitting on it is still good – as good as it’s been in decades, thanks to the high rate of return available on short-term, safe government debt. That’ll be the case until the Federal Reserve’s rate-cutting cycle is well underway.

GameStop made a lot from just that, thanks to its major cash infusions from a pair of share offerings during the second quarter as the return of Keith Gill reignited enthusiasm for the stock even as its core business and outlook remain lackluster. Net interest income was a cool $39.5 million, more than offsetting its operating losses.

This “is primarily attributable to interest income increasing as a result of higher returns on invested cash, cash equivalents, and marketable securities, as well as return on cash received from the issuance and sale of shares of our common stock from the ATM Offering,” said the company in its quarterly filing.