Activist company

GameStop shares soar over 10% as company plans to split its shares

GameStop shares jumped in extended trading on Thursday after the company announced it plans to implement a stock split.

The video game retailer said it would seek shareholder approval at its next shareholder meeting for an increase in the number of Class A ordinary shares from 300,000,000 to 1,000,000,000 to partially proceed with a stock split in the form of a stock dividend.

Shares of the same stock jumped 17% in after-hours trading on Thursday following the announcement.

It was unclear how much of the increase in the number of shares would be used for the stock split. GameStop inserted a line in a regulatory filing suggesting that some of the stock increase could be used at some point for other means, possibly selling more shares.

The clearance would also be used to “provide flexibility for future business needs,” the company said.

The stock dividend will be subject to final board approval, GameStop said.

GameStop shares fell this month, up 35%, as enthusiastic retail investors stood alongside their favorite meme. The stock rose earlier this month when Chairman Ryan Cohen purchased an additional 100,000 shares, taking the activist investor‘s stake to 11.9%.

Still, investors and analysts hoping for a fundamental turnaround from GameStop have been disappointed so far, as the company has revealed few details about its e-commerce transformation.