The price-drop curse remains in place.

After falling immediately following the release of 10 of its past 11 quarterly reports, the share price of video gaming retailer GameStop (GME -3.94%) is down -- again -- in Wednesday's after-hours trading, following the post-close release of the company's second-quarter results. Although sales topped estimates, the bottom-line loss was bigger than expected.

It's arguable, however, that GameStop's status as a highly touted meme stock was going to spark a sell-off regardless of the results it tendered Wednesday afternoon.

Falling bar chart representing dollars.

Image source: Getty Images.

GameStop's second-quarter numbers (if they matter right now)

During the three-month stretch ending in July, GameStop turned $1.18 billion worth of sales into an adjusted operating loss of $0.76 per share. Both figures are marked improvements on the COVID-19-crimped comparable figures from a year earlier when the company booked a non-GAAP per-share loss of $1.22 on revenue of $942 million. Note too that analysts were only calling for sales of $1.12 billion this time around. These same analysts were also modeling a more modest loss of $0.66 per share, though, leaving the company a dime short of projections.

That was enough for traders to decide the glass is half-empty rather than half-full. Share prices were down nearly 10% shortly after the Q2 numbers were released, but before the earnings conference call began.

Investors, however, shouldn't look past the fact that GameStop has been a highly volatile meme stock for much of the year. It would also be short-sighted to ignore the biggest reason this name has captured the attention of so many active investors hoping to carve out some gains by speculating on these meme stocks.

As to the first point, while the stock spent most of Wednesday trading well below February's peak near $483 a share, the current price near $199 is also still well above the price of $18.84 a share (where it closed out 2020). GameStop caught the attention of a wide swath of retail traders early this year, who attempted to spark a short squeeze by forcing hedge funds and other traders that had bet against the stock (by selling it short) to suddenly buy it back en masse. This would have the effect of driving shares sharply higher due to the flood of sudden buying, which induces more panic, which spurs more buying, etc. The gambit worked for a while, too, although its effectiveness has waned since March, and has been particularly ineffective in recent weeks.

The underpinning impetus for that very first rally and all the other subsequent short-covering rallies, however, is still intact. It boils down to the retailer's new management team with a new vision for this brick-and-mortar retailer.

The new vision largely comes from Chewy co-founder Ryan Cohen, who now serves as chairman of GameStop's board. He also replaced all of the company's key executives with hand-picked people better versed in e-commerce. While Cohen has said little as to his plans to overhaul the struggling company, he has been willing to say he intends to make GameStop the Amazon of the video gaming industry.

The refocus on e-commerce doesn't guarantee success

The question remains, however: What does that really mean?

And Cohen may find the retailer faces a unique set of challenges. Namely, physical copies of video games are being increasingly supplanted by digital downloads of video games, cutting into a huge piece of GameStop's business -- online or offline.

Although the pandemic prompted many consumers to download new games rather than visit a store or order them online, this trend was already in place before COVID-19. The pandemic simply accelerated this shift, with around half of console and PC game sales now being made through an online purchase.

In this same vein, Sony sells a version of the PlayStation 5 game console without a disc drive or cartridge insert meant to serve gamers who are willing to download all of their game purchases. Ditto for Microsoft's Xbox.

And once gamers gain comfort with the idea of not owning a physical disc, they tend to stick with the approach.

Games aren't all that GameStop sells, of course. Collectibles, T-shirts, board games, and other goodies are also part of its product mix. It remains to be seen, however, if these sorts of goods will help GameStop build a more meaningful e-commerce presence.

Listen carefully for any clues

It's possible investors will finally start to hear some insight as to Cohen's plans to rebuild GameStop during Wednesday's earnings conference call (which had yet to occur when this story was written). This will be the first call, after all, with new CEO Matt Furlong at the helm of the company. Ditto for CFO Mike Recupero, both of whom previously worked for Amazon.

It's also possible, however, none of the company's new leaders are quite ready to serve up much in the way of details about what's in store. That's too bad, since, after last quarter's earnings miss, that may be the only thing that puts investors back in a bullish mood.