GameStop fires its CEO and appoints a new chairman of the board – causing shares to plummet more than 20%
- GameStop fired its CEO and named investor Ryan Cohen as executive chairman
- Cohen founded pet food retailer Chewy and his company owns 12 percent of GameStop
- GameStop’s share price fell more than 20 percent in after-hours trading
GameStop has fired its CEO and promoted Chewy founder and investor Ryan Cohen to executive chairman, the company announced Wednesday.
The appointment came as the company reported in an SEC filing of quarterly revenues of $1.24 billion, down from $1.38 billion in the same period last year.
The outgoing CEO, Mathew Furlong, is a former Amazon executive and was appointed in June 2021. The filing on Wednesday suggested he would be entitled to “payments and benefits in connection with termination without cause.”
New executive chairman Ryan Cohen is the founder of pet food delivery company Chewy and joined the company board in January 2021. He is the manager of RC Ventures, which took a significant position in GameStop in 2020.
Hours after the change was announced, Cohen posted a bizarre and cryptic tweet that simply read, “Not for long.” The stock fell more than 20 percent in extended trading Wednesday evening.
Chewy.com founder Ryan Cohen (pictured) has been named executive chairman of GameStop, the company announced Monday. According to documents from last year, his investment company RC Ventures has a stake of about 12 percent in the company
GameStop CEO Mathew Furlong (pictured) was fired Monday, according to an SEC filing and company press release. He has held the position since June 2021
Furlong’s appointment as CEO in 2021 was part of a turnaround plan for the company as it struggled to adapt to the gaming industry’s shift away from physical discs
Furlong’s appointment as CEO in 2021 was part of a turnaround plan for the company as it struggled to adapt to the gaming industry’s shift away from physical discs.
While it reported a drop in revenue on Wednesday, it also announced a smaller loss than the same period last year — $50.5 million compared to $157.9 million in the first quarter of 2022.
Months ago, it also announced its first profitable holiday quarter in two years.
The June 7 SEC filing notes that Furlong also resigned as a director of the company on Monday, June 5, reducing the board to just five members.
It also noted Cohen’s new responsibilities would include “allocating capital, evaluating potential investments and acquisitions, and overseeing the managers of the company’s holdings.”
Cohen founded Chewy.com in June 2011 as an online pet food retailer and was able to compete with Amazon by focusing on customer service.
He sold Chewy to PetSmart for $3.35 billion in 2017 and left the company a year later. A 2019 IPO of the company valued it at $8.8 billion.
Shortly after the announcement on Wednesday, Cohen posted a cryptic tweet saying “Not for long”
Furlong was appointed CEO two years ago, in June 2021. The stock soared in early 2021 due to the meme stock craze, reaching as high as $62 per share in June. It has since fallen, and on Wednesday the stock was valued at $26. In after-hours trading on Wednesday, it dropped to just $20 per share
Cohen’s induction to the company’s board of directors in 2021 was viewed positively by investors, and the stock rose about 13 percent on the day of the announcement.
Alan Attal and Jim Grube were also added to GameStop’s board at the time. Attal is an old friend and business partner of Cohen’s and helped found Chewy. Grube worked on Chewy’s customer acquisition model.
As part of this week’s shuffle, Attal was named the board’s lead independent director, the SEC filing said.
DailyMail.com wrote to GameStop for additional information about the uproar and Cohen’s tweet, but didn’t hear back.