GameStop (GME) - Get Report was climbing Tuesday following reports that entrepreneur Ryan Cohen, who recently acquired a 10% stake in the videogame retailer, said he believed the company could rival Amazon.com (AMZN) - Get Report.
Shares of the Grapevine, Texas, company at last check were surging 21% to $10.54.
Cohen, GameStop's biggest individual investor, disclosed that he was holding talks with management and several board members.
Cohen’s firm, RC Ventures, has said it's willing to get more involved with GameStop “to produce the best results for all shareholders,” according to a filing, Bloomberg reported.
The investor wants to broaden GameStop’s online selection and compete head-to-head with some of the biggest e-commerce companies, Bloomberg said, citing a person familiar with the matter.
Instead of just offering videogames as well as toys, clothing, and accessories, GameStop's website would sell a wide range of merchandise and ship it to customers more quickly.
Cohen wants the company to improve its customer service and build the infrastructure needed to offer thousands of items and services,
Part of his plan would be to offer more online services, where, for example, customers would be able to trade in old videogames online, rather than just in stores. And GameStop could offer more game-streaming subscriptions.
While the company has closed hundreds of stores, as of last quarter GameStop had 5,122 locations in 10 countries.
The company has had difficulties with the videogame industry’s shift to online distribution, but a new generation of console hardware starting this year is expected to help.
Earlier this month, GameStop reported a narrowed fiscal-second-quarter loss but came up short of analysts' expectations. Net sales fell 27% to $942 million from $1.29 billion.