December 22, 2025 — Michael Burry is back in the spotlight, and not just for “The Big Short.” In recent days, the famously contrarian investor has revisited one of the most talked-about trades of the past decade: his early, deeply discounted bet on GameStop — and the uncomfortable truth that he exited before the meme-stock frenzy turned the ticker into a cultural phenomenon. [1]
At the same time, GameStop’s path into 2026 is increasingly being defined less by nostalgia for 2021 and more by a business reality Wall Street can model: a growing collectibles segment that management and analysts view as one of the retailer’s clearest bright spots. The company’s merchandising playbook is showing up in places investors don’t usually associate with “turnarounds” — including exclusive tie-ins and pre-order promotions around major gaming releases like Capcom’s upcoming Resident Evil Requiem. [2]
That mix of storylines — Burry’s candid hindsight, meme-stock sensitivity to headlines, and GameStop’s push to monetize fandom through higher-margin merchandise — is shaping today’s narrative around $GME as markets head into the final trading days of 2025.
What Michael Burry says he missed about GameStop’s 2021 explosion
Burry’s central admission is simple: he was early, he was right on valuation, and he still missed what became the defining price move. In a recent post tied to his GameStop experience, Burry described selling his position only weeks before the January 2021 rally accelerated into a historic short squeeze, acknowledging he “had no idea what was coming.” [3]
According to reporting on Burry’s Substack posts and related commentary, he built his GameStop stake using a deep-value framework he’s applied before — a strategy he has likened to buying “unloved” companies for pennies on the dollar. Coverage of the post notes he drew parallels between GameStop and an earlier investment he made in 2001 (Avanti), framing both as situations where traditional market narratives obscured balance-sheet-driven opportunity. [4]
But GameStop didn’t just rise because it was cheap. The 2021 event combined extreme short interest with a powerful options-driven feedback loop (often described as a “gamma squeeze”), as call-option activity forced market makers to buy shares to hedge — pushing the price higher and intensifying the scramble. [5]
Burry’s reflection matters because it cuts against the neat myth that the “smart money” always sees the full picture. Even an investor who identified value early can still be blindsided when market structure, positioning, and social momentum collide.
The trade that became legend — and why Burry exited anyway
Burry’s GameStop position has been dissected for years, but the latest wave of coverage adds more detail to the timeline and his reasoning.
Business Insider reports that Burry first saw GameStop as attractive as far back as 2018, and later built a significant stake — nearly 5% at one point — at a split-adjusted average price of about $0.83 a share. He held the position for more than a year, benefited from lending shares, and then sold at roughly $3.38 a share in late 2020 — ahead of the most dramatic phase of the 2021 run. [6]
In hindsight, that exit became the kind of “pain trade” that markets love to memorialize: a fundamentally driven investor leaving just before a fundamentally unexplainable surge. Burry has pointed to classic concerns — execution risk and skepticism around the odds of a sustained turnaround — as reasons he didn’t stick around. [7]
He’s also indicated he plans to publish a more current breakdown of GameStop as an investment “today,” suggesting the story isn’t just a retrospective — it’s becoming a renewed analytical project for him. [8]
GameStop’s 2025 reality check: sales pressure, profit improvement, and a collectibles surprise
For GameStop itself, the story heading into 2026 isn’t primarily about short squeezes. It’s about what’s working inside the business — and what isn’t.
The Wall Street Journal recently reported that GameStop’s total sales fell 4.6% year over year to $821 million in its fiscal third quarter, driven by weakness in core categories like hardware and accessories (down 12%) and software (down 27%). [9]
Yet the same report highlighted a striking countertrend: collectibles sales surged 50% to $256.1 million, rising to roughly one-third of total revenue — up from about one-fifth a year earlier. [10]
That is a meaningful shift in the GameStop conversation because it reframes what “the turnaround” might actually mean:
- Less dependence on used games and physical software (a structurally declining market)
- More emphasis on fandom-driven purchasing: figures, apparel, exclusive drops, and tie-in merchandise
- A business model where community and identity can translate into higher-margin revenue
GameStop’s balance sheet also remains a major part of why it stays relevant in markets even when growth is elusive. Barron’s has reported that the company’s large cash and securities position helps keep bankruptcy fears muted and gives management flexibility — even as the stock remains far below the highs of the meme era. [11]
Why ‘Resident Evil Requiem’ matters to GameStop’s new strategy
One reason investors are paying attention to merchandising headlines is that GameStop is increasingly leaning into what cannot be digitized away: physical products, exclusives, and fandom collectibles.
A clear example is the retailer’s push around Capcom’s Resident Evil Requiem. On GameStop’s own product page, the company lists pre-orders for multiple platforms and highlights a limited-quantity tote bag as a pre-order bonus. [12]
Key details GameStop is promoting include:
- Release date: February 27, 2026 [13]
- Platforms: PlayStation 5, Xbox Series X|S, PC, and Nintendo Switch 2 [14]
- Pre-order perk: “Get a free tote bag” (limited quantities; in-store pickup language appears in multiple write-ups) [15]
Gaming outlets have treated the tote-bag bonus as a small but telling sign of how GameStop is trying to win: not by fighting digital distribution head-on, but by giving fans an extra reason to transact through GameStop instead of a rival retailer. [16]
This is the same logic behind the broader “collectibles are the bright spot” thesis. Exclusive merchandise and physical add-ons don’t need to be massive on their own; they work as attachments that improve the economics of a customer relationship.
The stock is still headline-sensitive — and today’s chatter reflects that
GameStop remains one of the market’s most reflexive tickers: it can move on earnings, but also on internet attention, retail sentiment, and pop-culture catalysts.
A Red94 report published today links a move in $GME to the reveal of Resident Evil Requiem exclusives and positions collectibles as a core reason the company “matters” heading into 2026. [17]
Even without treating any single merch drop as fundamental on its own, the direction is consistent with what recent financial reporting suggests: collectibles and branded merchandise are increasingly central to the GameStop investment debate. [18]
Burry’s broader message on December 22: from meme stocks to the AI trade
What makes today’s Burry narrative particularly sticky is that he isn’t only revisiting old battles. He’s actively wading into the market’s biggest present-tense theme: artificial intelligence.
In a Business Insider story published today (December 22, 2025), Burry argued that the U.S. risks losing the AI race to China if it relies on Nvidia’s increasingly power-hungry chips, pointing to China’s power-generation advantage and calling for more efficient, task-specific alternatives (ASICs). [19]
Whether investors agree or not, it reinforces the throughline across his recent public comments: Burry is focused on structural constraints, crowded trades, and the gap between narrative and fundamentals — the same lens he’s now applying again to GameStop.
What to watch next for GameStop, GME, and the “Burry effect” in 2026
As 2025 closes, three practical questions are likely to shape the next phase of the $GME storyline:
1) Can collectibles stay hot enough to offset declines elsewhere?
A 50% jump in collectibles revenue is meaningful — but investors will want to see whether that demand persists beyond novelty cycles and whether it improves profitability over time. [20]
2) Do tie-ins like ‘Resident Evil Requiem’ translate into repeatable economics?
Pre-order bonuses and exclusives can drive incremental traffic and attachment sales, but the long-term test is whether GameStop can keep building a differentiated pipeline of “only-at-GameStop” product moments. [21]
3) Will Burry’s promised GameStop breakdown change the conversation — or just amplify it?
Burry has teased a more current investment analysis of GameStop under CEO Ryan Cohen, and any detailed public write-up could feed both serious debate and the retail-driven feedback loops that still surround the stock. [22]
For now, the most defensible takeaway is also the least dramatic: GameStop is no longer just a meme-stock symbol. Based on recent financial disclosures and coverage, it’s increasingly a company trying to engineer a workable retail model around collectibles and fandom — and it’s doing so under the constant pressure of a stock price that can still react to almost anything. [23]
References
1. www.businessinsider.com, 2. www.wsj.com, 3. www.businessinsider.com, 4. www.benzinga.com, 5. en.wikipedia.org, 6. www.businessinsider.com, 7. www.businessinsider.com, 8. www.businessinsider.com, 9. www.wsj.com, 10. www.wsj.com, 11. www.barrons.com, 12. www.gamestop.com, 13. www.gamestop.com, 14. www.gamestop.com, 15. www.gamestop.com, 16. www.nintendolife.com, 17. www.red94.net, 18. www.wsj.com, 19. www.businessinsider.com, 20. www.wsj.com, 21. www.gamestop.com, 22. www.businessinsider.com, 23. www.wsj.com
