GameStop’s annual shareholder meeting faced technical difficulties as servers crashed due to overwhelming interest in the stream, according to a customer service representative for the company hosting the event. The meeting was scheduled to begin at 11 a.m. ET on ComputerShare, but many people received error messages and couldn’t access the event. The meeting was eventually brought to order at 11:48 a.m. ET but was immediately adjourned due to technical difficulties. GameStop promised to provide an update on the rescheduled event.
The customer service representative for ComputerShare explained that the servers couldn’t handle the high volume of traffic and weren’t accustomed to such a large number of accounts. ComputerShare’s tech team was working to resolve the issue, and interested parties were advised to try logging in every 5 to 10 minutes. This disruption came at a time when GameStop was experiencing a surge in meme stock craze, fueled by Keith Gill’s (also known as Roaring Kitty) return to social media after three years. Gill had gained notoriety for his big bets on GameStop, which incited retail traders.
In light of the recent meme stock rally, GameStop raised over $2 billion in an at-the-market equity sale. The company plans to utilize the funds for general corporate purposes, including acquisitions and investments. Traders have been closely monitoring Roaring Kitty’s actions, as his active selling could impact the stock price. On Wednesday, there was a sudden sell-off in GameStop shares coinciding with a spike in trading volume for the call options that Roaring Kitty owns. Call options give the buyer the right to purchase a stock at a specific price within a certain timeframe.
Specifically, GameStop calls with a $20 strike price and June 21 expiration saw a significant increase in trading volume. Over 93,000 contracts were traded, more than nine times the usual 30-day average volume. The price of these contracts dropped by more than 40% during the session, while the stock itself plummeted by 16.5%. Roaring Kitty was reportedly the owner of 120,000 contracts of those calls. However, it is unclear if he was responsible for the large volume observed. The open interest on those calls has already declined to 111,818 contracts, below Roaring Kitty’s initial holding of 120,000.
The situation surrounding GameStop and Roaring Kitty continues to be closely watched by traders and investors alike. The volatility in the stock market, particularly with meme stocks, highlights the influence of social media and individual traders on market movements. As the GameStop saga evolves, it serves as a reminder of the power of retail investors and their ability to disrupt established norms in the financial world.
