US video game retailer GameStop has made a $55.5 billion (£41 billion) unsolicited takeover offer for eBay, with its CEO warning that the bid could turn hostile if rejected by eBay's board.
Bid Details
GameStop, which has quietly accumulated a 5% stake in eBay, is offering $125 per share, split evenly between cash and stock. The move is ambitious for the games company, which rose to fame during the 2021 meme-stock craze but is valued at far less than its target. GameStop had a market capitalization of roughly $12 billion on Friday before the bid, while eBay—founded by Pierre Omidyar in 1995—is worth about $46 billion.
CEO's Vision
Ryan Cohen, who has led GameStop since 2020, claims eBay could be worth much more under his leadership. In a letter to eBay chair Paul Pressler, Cohen outlined plans for an immediate cost-cutting program that would slash $2 billion in annual spending. "Ebay should be worth—and will be worth—a lot more money," Cohen told the Wall Street Journal. "I'm thinking about turning eBay into something worth hundreds of billions of dollars. It could be a legit competitor to Amazon."
Potential Hostile Turn
Cohen, dubbed the "meme king" by retail traders, said he is prepared to take the offer directly to eBay shareholders if the board is not receptive. The bid is backed by a $20 billion loan from TD Securities, though Cohen may also seek external investors, including Middle Eastern sovereign wealth funds.
GameStop's Background
GameStop's fame surged during the 2021 meme stock craze, when Gen Z and millennial investors drove shares from $3.25 in April 2020 to $347.50 in late January 2021—a 10,692% increase. While GameStop has since closed hundreds of stores, including 590 in 2025, Cohen believes the remaining 1,600 sites can serve as a "national network for authentication, intake, fulfillment, and live commerce" for eBay. These stores could act as drop-off and shipping nodes and double as broadcasting studios for livestreamed auctions.
Criticism of eBay's Spending
In his letter, Cohen criticized eBay for spending $2.4 billion on sales and marketing in 2025 while seeing only a 0.75% net increase in active buyers. "More spend is not producing more users on a marketplace with near-universal brand recognition," he wrote. His cost-cutting plan would reduce eBay's annual sales and marketing budget by $1.2 billion, product development by $300 million, and administrative departments by $500 million. "Our board unanimously supports this proposal," Cohen said.
eBay's Recent Performance
The bid came days after eBay reported first-quarter revenue of $3.09 billion, beating analyst estimates of $3.04 billion, as it increased AI use to improve buyer-seller communication. eBay expects second-quarter revenue to exceed Wall Street forecasts, driven by demand for collectibles and live-streamed auctions. The company is also acquiring British secondhand fashion app Depop from Etsy for about $1.2 billion to attract younger consumers.
