(Reuters) – GameStop (NYSE:) earned nearly $933.4 million by selling 45 million shares, the struggling video game retailer said on Friday, sending its shares up more than 12% in after-hours trading.
The company relies heavily on brick-and-mortar stores and has struggled with customers turning to e-commerce firms to buy video games and collectibles.
Earlier this month, the company revealed its plan to sell shares amid a retail buying frenzy sparked by the return to social media of “Growling Kitty” Keith Gill, whose bullish calls for the company have fueled the meme stock’s rally in 2021.
The transaction was structured as an “on the market” offering, in which shares are sold at the prevailing market price rather than at a predetermined price.
The rally in retail mania GameStop began after Gill shared a meme and several movie clips.
The stock more than quadrupled from late April to May 14, then gave back about 60% of that gain as of Friday’s close.
GameStop did not disclose the price at which it sold the shares, but they sold at an average price of $20.74 per share, according to Reuters calculations. Its shares were currently trading at $21.93.
The company said it will use proceeds from the sale for general corporate purposes, which may include acquisitions and investments.
GameStop said last week it expected its first-quarter net sales to fall to $872 million to $892 million, down from $1.24 billion a year earlier.
Theater chain AMC, another retail darling, also completed a $250 million “on-market” stock sale program last week.