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GameSquare Holdings, Inc. (NASDAQ:GAME), a $27.16 million market cap company specializing in amusement and recreation services, is currently facing a potential delisting from The Nasdaq Stock Market due to non-compliance with the minimum bid price requirement. The stock currently trades at $0.69, significantly below InvestingPro’s Fair Value estimate, suggesting potential undervaluation despite its challenges. On Monday, the company received an extension from Nasdaq, granting it until October 13, 2025, to meet the minimum bid price of $1.00 per share. The notice follows an initial warning received on October 16, 2024, and allows GameSquare additional time to execute a reverse share split if necessary to regain compliance.
In a separate matter, GameSquare has entered into a settlement agreement related to a class action lawsuit that originated from its acquisition of FaZe Holdings, Inc. The company’s financial position shows some strain, with InvestingPro data revealing negative EBITDA of -$23.11 million and weak gross profit margins of 15.88%. The lawsuit, filed by Nathan Carter on behalf of B. Riley Principal 150 Merger Corp. (BRPM) shareholders, alleged that BRPM’s directors and officers breached fiduciary duties by omitting material information from offering documents related to the merger with FaZe Clan, Inc. GameSquare, which assumed certain indemnification obligations through the acquisition, along with BRPM, agreed to contribute a combined total of $1,050,000 in cash and company stock to settle the claims. The court must approve the settlement, with a hearing scheduled for May 13, 2025.
GameSquare’s management has stated their intention to monitor the stock’s bid price closely and explore options to regain compliance with Nasdaq’s listing standards. The company’s future actions could include implementing a reverse share split before the expiration of the second compliance period. However, there is no guarantee that GameSquare will achieve compliance within the given timeframe or maintain other listing requirements. InvestingPro analysis reveals additional challenges, including rapid cash burn and short-term obligations exceeding liquid assets. Subscribers can access the full Pro Research Report, which provides comprehensive analysis of GameSquare’s financial health, valuation metrics, and growth prospects among 1,400+ top stocks.
The information in this article is based on a press release statement from GameSquare Holdings, Inc.
In other recent news, GameSquare Holdings, Inc. has announced its strategic decision to divest its 25.5% stake in FaZe Media to Gigamoon Media and FaZe’s founders, effective April 1, 2025. This move is part of GameSquare’s broader strategy to streamline operations and focus on profitability while continuing to own the profitable FaZe Esports. Additionally, GameSquare has secured a $2 million credit facility from the Jones Family to support its expansion in the U.S. gaming and esports experiences business. The company also announced the successful election of eight directors and approval of key proposals during its annual meeting, including amendments to its stock incentive plan. GameSquare received an extension from Nasdaq to address compliance issues related to its annual shareholder meeting, with plans to meet the requirements by March 12, 2025. In another development, GameSquare settled its outstanding convertible note with Yorkville Advisors Global L.P., issuing a zero-coupon, 60-day promissory note. This move aims to streamline GameSquare’s capital structure and eliminate potential stock dilution. Lastly, GameSquare plans to host the GAMERGY esports festival in Dallas in March 2026, in partnership with GGTech Entertainment, as part of its strategy to expand gaming events in the U.S.
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