GameStop unveils new CEO, CFO leading e-commerce transformation
Stock falls after-hours as company declines to provide a full-year forecast
SEC scrambling to deal with meme stock mania: Sources
Sources tell FOX Business' Charlie Gasparino that securities lawyers says SEC looking at possible manipulation cases that will be difficult to prosecute.
Amazon veterans Matt Furlong and Mike Recupero have been tapped to help lead GameStop's e-commerce transformation, replacing outgoing CEO George Sherman and former chief financial officer Jim Bell.
During his nearly nine years at Amazon, Furlong oversaw the e-tailer Australia business operations and previously served as technical advisor to the head of Amazon's North America consumer business. Prior to Amazon, Furlong worked as an executive with consumer goods giant Proctor & Gamble, focusing on brand, marketing and sales strategies. He will take the reins at the video game retailer starting June 21.
"Matt is a proven e-commerce leader with a firm understanding of how to delight customers," Sherman said on the company's first-quarter earnings call."His focus, intensity and work ethic will set the right tone atop the company as we begin shifting to a growth phase."
GAMESTOP'S RYAN COHEN TELLS INVESTORS ‘BUCKLE UP’ AFTER BEING ELEVATED TO CHAIRMAN OF THE BOARD
Meanwhile, Recupero, who spent more than 17 years as a technology industry finance executive with Amazon, serving as chief financial officer of Amazon's North American and European Consumer businesses and Prime Video, will start as GameStop chief financial officer on July 12.
"I look forward to working with Matt and Mike to ensure a seamless transitions in the coming weeks," Sherman added.
SEC MULLS GAMESTOP, AMC ‘GAMIFICATION’ CRACKDOWN WITH REGULATORY LAYER
The latest appointments round out GameStop's new executive leadership team created by Chewy.com founder and newly elected chairman of the board Ryan Cohen.
Cohen, who owns a 13% stake in GameStop through his investment firm RC Ventures, joined the company's board in January as its shares began to soar to unprecedented levels amid a short squeeze fueled by investors on Reddit's speculative investing forum, WallStreetBets.
Other Amazon veterans rounding out GameStop's leadership team include Elliott Wilke, Jenna Owens and Matt Francis, who will serve as GameStop's chief growth officer, operating officer and first chief technology officer, respectively.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
During GameStop's annual shareholder meeting on Wednesday, Cohen acknowledged the team would have a long road ahead.
"We have a lot of work in front of us and it will take time," Cohen told shareholders, according to remarks posted on Reddit. "We are trying to do something that nobody in the retail space has ever done, but we believe we are putting the right pieces in place and we have clear goals: delighting customers, and driving shareholder value for the long term."
GameStop recently announced plans to open a distribution center in York, Pennsylvania to further expand its North American fulfillment network in support of its e-commerce push. The facility is expected to be operational by the fourth quarter of 2021.
However, the company remains tight-lipped about the rest of its future plans, with Cohen warning investors to "buckle up."
CLICK HERE TO READ MORE ON FOX BUSINESS
GameStop topped Wall Street expectations on Wednesday with a narrower first-quarter net loss of $66.8 million, or $1.01 per share, compared to $165.7 million or $2.57 per share during the same period a year ago. The company's adjusted net loss was $29.4 million, or $0.45 per share, compared to an adjusted net loss of $157.6 million, or $2.44 per share, a year ago.
Net sales increased 25.1% year-over-year to $1.28 billion, compared to $1.02 billion a year ago, overcoming a nearly 12% reduction in the company’s global store base due to "strategic de-densification efforts", and continued store closures across Europe due to the COVID-19 pandemic.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| GME | GAMESTOP CORP. | 29.05 | -1.84 | -5.96% |
GameStop shares plunged as much as 9% in after-hours trading Wednesday after the company declined to provide a forecast for the full year. The company believes total net sales are "the most appropriate metric to evaluate performance at this time," noting its second-quarter sales trends continue to reflect momentum, with May total sales increasing approximately 27% compared to last year.
In addition, the retailer warned it may offer and sell up to 5 million shares of its common stock in "at-the-market" offerings. The proceeds will be used for general corporate purposes as well as investing in growth initiatives and maintaining a strong balance sheet.
GameStop previously raised approximately $551.7 million through an at-the-market offering of 3.5 million shares in April. The company also eliminated its long-term debt with the completion of a voluntary early redemption of $216.4 million of its 10.0% senior notes due in 2023.