GameStop CEO Ryan Cohen’s $35 Billion Pay Package Faces Lawsuit While Hostile eBay Bid Stalls

GameStop Corp. finds itself at one of the most turbulent crossroads in its already chaotic modern history. The company that became the defining symbol of the retail investor revolution is simultaneously grappling with a shareholder lawsuit seeking to block what would be one of the largest executive compensation packages ever proposed, a stalled hostile takeover attempt against a company five times its own size, and a stock price that continues to trade modestly while analysts and investors try to price in an extraordinarily uncertain future.

Shares of GameStop traded at $21.54 on Thursday morning, up a modest 0.12%, as the company’s many moving parts continued to generate headlines without delivering the transformational momentum Chief Executive Ryan Cohen has spent years promising.

The Lawsuit: Shareholders Push Back on a Historic Pay Package

A GameStop investor has filed a lawsuit seeking to block a vote on Cohen’s proposed $35 billion compensation package, arguing that investors haven’t been given enough information to understand exactly what they’re being asked to approve.

According to Bloomberg, the lawsuit centers on disclosure concerns. The shareholder claims key details about the structure, valuation, and long-term consequences of the package were not adequately explained in materials distributed ahead of the vote. The suit seeks to halt or postpone the shareholder meeting until additional information is provided.

A $35 billion compensation package would rank Cohen’s potential payout among the largest ever put before shareholders. Corporate governance experts have long argued that mega-pay plans require extensive disclosures so investors can determine whether executive rewards are truly tied to company performance.

The compensation structure itself is tied to performance milestones. Under his January compensation package, Cohen stands to receive options on more than 171 million GameStop shares if he manages to push the company’s market capitalization to $100 billion — a tenfold increase from current levels. That target is staggering given GameStop’s current trajectory, and the lawsuit reflects growing shareholder skepticism that the plan’s terms have been adequately disclosed or justified.

The eBay Gambit: Bold, Rejected, and Still Unresolved

The compensation lawsuit arrives in the direct wake of Cohen’s most audacious and publicly humiliating strategic setback: a $56 billion hostile takeover bid for eBay that the e-commerce giant’s board rejected swiftly and sharply.

In a letter sent in May, GameStop proposed to acquire all common stock of eBay at $125.00 per share, comprising 50% cash and 50% GameStop common stock, representing a 46% premium to eBay’s unaffected closing price and a 27% premium to the 30-day volume-weighted average price. The aggregate undiluted equity value was approximately $55.5 billion.

On May 12, 2026, eBay officially rejected Ryan Cohen’s aggressive takeover attempt. In a sharply worded letter to Cohen, eBay Chairman Paul Pressler called the unsolicited offer “neither credible nor attractive.”

Cohen did not retreat quietly. After the board rejected the proposal, Cohen launched a hostile bid, taking the offer directly to eBay shareholders. In a television interview, Cohen addressed the financing skepticism directly, telling interviewers the cash consideration would be funded from GameStop’s balance sheet and a highly confident letter from TD Securities for up to $20 billion in third-party acquisition financing.

The strategic logic Cohen has advanced is a vision of GameStop as an e-commerce and collectibles powerhouse. GameStop projected it would deliver $2 billion of annualized cost reductions within twelve months of closing, including approximately $1.2 billion from sales and marketing, $300 million from product development, and $500 million from general and administrative expenses. The company also argued its approximately 1,600 U.S. locations would give eBay a national network for authentication, intake, fulfillment, and live commerce.

Record Earnings, Massive Cash, and a Pivot to Collectibles

What makes GameStop’s position unusual is that beneath the drama of hostile bids and compensation fights sits a company that has, by conventional financial metrics, performed remarkably well in recent quarters.

GameStop reported first-quarter 2026 results showing net sales rose 14% year-over-year to $835.3 million, driven by collectibles. Net income reached a record $389.6 million, and operating income was $143.3 million, the highest first-quarter level on record. Liquidity totaled $9.7 billion, including $8.4 billion in cash, cash equivalents and marketable securities.

On June 2, 2026, the board approved a new $2.0 billion share repurchase authorization through June 2, 2029, replacing the 2019 program. That buyback, funded from the company’s enormous cash reserves, represents a direct return of capital to shareholders — a conventional move that stands in stark contrast to the unconventional eBay gambit playing out simultaneously.

GameStop launched Power Packs, a digital trading card platform, in April 2026, with packs starting at $25 and ranging up to $2,500. Cards are PSA-graded, stored in the PSA Vault, and can be sold back instantly, shipped home, or added to a collection. Launch categories include Pokémon, Football, Basketball, and Baseball. The launch signals that Cohen’s collectibles strategy is not merely rhetoric — it is being built out with specific product lines that give GameStop a credible presence in one of retail’s fastest-growing categories.

Bitcoin, Warrants, and a Company Still Reinventing Itself

GameStop’s balance sheet transformation extends to cryptocurrency. GameStop renewed an options deal that ties up nearly all its Bitcoin, with a covered-call strategy attached to its holdings. The Bitcoin position, which had been valued at hundreds of millions of dollars in prior quarters, represents yet another dimension of the company’s ongoing experiment in nontraditional asset deployment.

The company also distributed warrants to shareholders in October 2025. Eligible holders of record as of October 3, 2025 received one warrant per 10 shares. Each warrant permits the purchase of one share at a $32.00 exercise price and is exercisable through October 30, 2026.

What Comes Next

The intersection of the $35 billion compensation lawsuit, the ongoing eBay hostile campaign, record earnings, a $2 billion buyback, and a collectibles-driven transformation makes GameStop one of the most complex and contested investment narratives on Wall Street.

GameStop’s $8.4 billion cash position covers most of its market cap, offering significant downside protection and acquisition optionality, according to analysts, who note that the company’s core fundamentals have improved dramatically even as its strategic ambitions remain deeply polarizing.

For retail investors who drove GameStop’s original short squeeze in 2021, the company’s current chapter offers something simultaneously familiar and strange: a CEO willing to swing for the fences, a market that isn’t sure what to make of it, and a stock that is, for now, waiting for clarity.