GameStop’s annual shareholder meeting faced a major setback on Thursday as computer problems caused servers to crash under overwhelming interest in the stream. According to a customer service representative for the company hosting the stream, the meeting was scheduled to begin at 11 a.m. ET and was hosted on ComputerShare. However, when attendees tried to access the event, many encountered error messages indicating that the page couldn’t load. This issue was confirmed through posts on social media sites and CNBC’s own attempts to access the event.
A YouTube stream from an unaffiliated user attempting to reproduce the feed revealed that the annual meeting was finally brought to order at 11:48 a.m. ET, only to be “immediately adjourned … due to technical difficulties that have prevented stockholders from accessing the meeting.” GameStop promised to provide an update on the rescheduled event as soon as possible. Despite CNBC’s efforts, GameStop was unreachable for comment regarding the situation. When contacted via phone, a ComputerShare customer service representative explained that the company was facing a “mass amount” of issues as individuals tried to access the meeting. ComputerShare’s servers seemed unable to handle the volume of traffic the meeting garnered, underscoring their lack of preparation for the event. The tech team at ComputerShare was diligently working to address the problem and advised interested parties to make login attempts “every 5 to 10 minutes”.
The chaotic shareholder meeting disruption took place amidst a new meme stock craze triggered by Keith Gill’s resurgence on social media platforms after a three-year hiatus. Known as Roaring Kitty in online circles, Gill previously made high-stake bets on GameStop’s stock, creating a buzz among retail traders. In response to the meme stock rally, GameStop experienced a 14.4% surge in its stock price on a particularly volatile session.
GameStop recently disclosed that it had acquired over $2 billion in a recent at-the-market equity sale during the meme stock resurgence. The video game company aims to utilize the capital for general corporate purposes, possibly including acquisitions and investments. Traders remained vigilant of Roaring Kitty’s activities as his selling actions could potentially impact the stock price significantly. Notably, a sudden sell-off in GameStop shares transpired as trading volume in the call options that Roaring Kitty possessed escalated. This phenomenon raised concerns among options traders, particularly regarding Roaring Kitty’s involvement in the trading activity.
The surge in trading volume was evident in the GameStop calls with a $20 strike price and an expiration on June 21, where 93,266 contracts were traded on Wednesday, surpassing the 30-day average volume of 10,233 contracts. A sharp drop in the price of these contracts occurred during the session, accompanied by a 16.5% decline in the stock price. Roaring Kitty’s ownership of 120,000 contracts raised suspicions about his potential influence in the market. However, the open interest on these calls had diminished to 111,818 contracts as of Thursday morning, falling below Roaring Kitty’s initial ownership of 120,000 contracts. The trading activity surrounding GameStop options remained intense, with over 47,000 contracts changing hands on Thursday.
The GameStop shareholder meeting fiasco serves as a stark reminder of the technical challenges that can disrupt crucial corporate events. The convergence of meme stock resurgence and options trading frenzy further added complexity to the market dynamics, raising questions about the influence of individual traders like Roaring Kitty. As the GameStop saga continues to unfold, investors and market observers will closely monitor the developments in the coming days.