GameStop and AMC stocks are in tears, but their businesses are not

To preserve its business, GameStop, based in Grapevine, Texas, has been working to pay off debt and pledged to speed up its e-commerce operations. During the recent holiday season, the company’s e-commerce sales increased more than 300% over the previous year’s comparable period, helped by the launch of new video game consoles from Microsoft Corp.

and Sony Corp.

One of the most recent members of GameStop’s board of directors, Chewy Inc. co-founder Ryan Cohen urged the company last year to leave insufficient stores in the United States. He also asked the company to close non-essential operations in Europe and Australia and use the proceeds to make technological improvements. , such as renovating the GameStop online store.

Analysts expect GameStop to post its fourth consecutive annual revenue drop in its most recent fiscal year, amid declining core operations and efforts to streamline its business.

—Sarah E. Needleman

AMC AMC 53.65%

Entertainment Holdings

AMC, the world’s largest film chain with nearly 1,000 locations, became the latest lover in the retail business landscape after signing a series of financing deals that are expected to help avert bankruptcy.

Since the outbreak of the coronavirus pandemic forced AMC to temporarily close most of its theaters, the Leawood, Canada-based company has faced the real possibility of running out of money and warned investors in October he might have to file Chapter 11. if he doesn’t raise enough money from investors willing to bet on his recovery.

AMC’s fortunes began to change with the introduction of coronavirus vaccines late last year, sparking hope among investors that people would not spend too much time in the cinema again.

The company has raised nearly $ 1.3 billion in debt and equity financing since December, selling its latest bookshelf offering on Jan. 27 just after users of Reddit’s WallStreetBets forum set their sights on it. action to prop up.

Still, AMC is not yet completely out of the woods and chief executive Adam Aron warned on Jan. 25 that while “any conversation about an impending bankruptcy is completely off the table,” it is recommended that Cautious AMC Investors The company’s future cash needs are uncertain in light of the ongoing pandemic and new coronavirus strains.

“Alexander Gladstone.”

Bed Bath & Beyond Inc.

BBBY 5.02%

After an activist investor sacked previous management in 2019, the home goods retailer is trying to give a twist to new CEO Mark Tritton, former Target Corp.

executive. Mr. Tritton has hired a new leadership team that slows down stores, simplifies pricing and streamlines merchandise. “The wider the range, the more confusing the customer is,” Tritton said in November.

The company closes about 200 of its more than 970 Bed Bath & Beyond stores and has sold assets considered non-core such as Christmas Tree Shops. It has also launched a $ 825 million share repurchase program over three years.

The company, which also owns BuyBuy Baby, is benefiting from a shift in pandemic-driven spending toward household items. But some analysts worry that once life returns to normal, it will give up some gains as shoppers spend more on traveling and eating out. The retailer also faces stiff competition from massive market chains like Target and online rivals like Amazon. On January 26, before the shares gave up some of their recent gains, UBS lowered it to “sell” in the face of concern that its change would occur on issues and other issues.

—Suzanne Kapner

Nokia Corp.

ENOUGH -2.77%

Nokia in its heyday dominated the market for rugged phones built to make phone calls and not much else. Then, the smartphone revolution robbed the Finnish company of the market share it enjoyed before, which led the company to abandon mobile phones and focus on the basic components of the mobile economy. : network equipment that connects mobile devices to the rest of the Internet.

Nokia’s profitability has suffered since the acquisition of Alcatel-Lucent, another network electronics maker in 2016. The merger made the new company more complex and forced costly upgrades for customers looking for cellular equipment. standardized. Rivals Ericsson AB and Huawei Technologies Co. they have seized the opportunity to gain market share in key countries.

The company still supplies much of the world’s network gear, a market about to grow this year as operators install new technology to support the fastest fifth-generation or 5G wireless service. Last year, the company rocked its management team by appointing a new chief executive and chief financial officer.

Nokia is preparing to sell more machines to replace Huawei-based Huawei cell tower equipment, which the U.S. and many allied countries have effectively banned for national security reasons. But geopolitics narrowed both directions, and growing tensions with the West could hurt Nokia’s own sales in China.

—Drew FitzGerald

BlackBerry Ltd.

BB -3.75%

BlackBerry CEO John Chen successfully rescued the Canadian company from near collapse after being hired in 2013 to reinvent a smartphone maker that had ceded its global market dominance to more agile competitors. with Apple. Inc.

and Samsung Electronics Co.

It reduced the company’s staff and global operations and authorized other manufacturers to manufacture BlackBerry phones.

Chen, a software veteran, tried to reinvent BlackBerry by selling software and services designed to protect business and government communication systems and mobile devices from viruses and other online threats.

He tried to expand this business in 2018 with a $ 1.4 billion purchase from Cylance Inc., an antivirus software maker. The acquisition has not yielded the promised change. Cylance co-founder Stuart McClure left in 2019 and BlackBerry revenue continues to decline. The company has reported net losses over the past seven quarters.

Another setback is the uneven demand for cars during the Covid-19 pandemic. BlackBerry sells security products to car manufacturers to protect car computer and communication systems from cyber threats.

“Jacquie McNish.”