GameStop shares soar as video-game retailer hints at coming board purge
GameStop's top shareholder Ryan Cohen is shaking it up
GameStop Corp. shares soared by as much as 47% Thursday after a regulatory filing said the company’s board of directors was set for a major shakeup.
Thursday’s advance recouped all of the prior day’s losses and then some, and extended Gamestop’s 2021 share price gain to 842%. The stock fell 34% on Wednesday after the Grapevine, Texas-based video-game retailer delivered its fourth-quarter results and left investors unimpressed with its turnaround plan.
“Our Board, through the Strategic Committee, is currently evaluating our executive leadership team skill sets related to meeting changing business requirements and has engaged a third party firm to assist it in its evaluation and exploration,” GameStop said in a filing with the U.S. Securities and Exchange Commission.
Eight directors, including former Nintendo of America chief operating officer Reginald Fils-Aimé and PetSmart CEO James Symancyk, are expected to retire from the board at the upcoming annual meeting, which is expected to take place in June.
A spokesperson for GameStop did not respond to FOX Business’ request for comment.
GameStop on Tuesday evening left investors with much to be desired after offering scant details of its e-commerce shift other than CEO George Sherman stating the company’s goal is to become the “ultimate destination for gamers” by growing its product catalog across PC gaming, computers, monitors, game tables, mobile gaming, gaming TVs and other areas.
Management did not accept questions from analysts.
GameStop is in the process of undertaking a major transformation of its business model led by Ryan Cohen, co-founder of online pet supply retailer Chewy.
Cohen was earlier this month tasked with leading the shift to an e-commerce-based model that relies on fast shipping. Already a number of changes have been made to the GameStop’s leadership team with CFO Jim Bell set to depart on Friday and Matt Francis, former engineering leader at Amazon Web Services, being appointed the company’s first chief technology officer.
GameStop’s e-commerce business showed signs of gaining momentum last year as more customers shopped from home amid the COVID-19 pandemic.
Global e-commerce sales surged 191% year over year in fiscal 2020. They made up 29% of total revenue, up a low single-digit percentage from the prior year.
GameStop, despite the improvements in its online sales, posted an adjusted net loss of $138.8 million for fiscal year 2020 after earning a $19.1 million profit the year prior. Net sales were down 21% year over year to $5.09 billion.