GameStop Video game retailers announced Thursday that they have fired Chief Financial Officer Mike Recupero and are reducing staff across departments as part of an aggressive turnaround plan.
Recupero, who joined the company about a year ago, was “dismissed because he wasn’t fit for the right culture” and “too much to let go,” a person familiar with the matter told CNBC. He was pushed out by GameStop chairman Ryan Cohen, he said.
The company’s chief financial officer, Diana Jajeh, will be the CFO. According to a submission to the US Securities and Exchange Commission, her starting salary is $ 200,000 and is eligible for a “transformation bonus” totaling $ 1,965,000.
The layoffs, announced in a note to employees taken by CNBC, are on the company side of the company, not the store, according to people familiar with the matter, with the goal of “reducing bloating” when GameStop invests. There are in other areas.
Traditional retailers have sought to reform themselves and keep up with the video game business, which has primarily moved online. Chewy Founder Cohen Tapped last year Lead the company’s turnaround.He used to be CEO Matt Farlon and Recupero. Amazon..
The company has hired more than 600 companies since its inception in 2021, according to a memo announcing the change.
GameStop stocks are also in the spotlight, and the stock price is skyrocketing due to the enthusiasm of meme stocks.
Still, retailers have the card near the vest. It provides little up-to-date information on a broader corporate strategy and has not been questioned by analysts about the company’s revenue demands for over a year. He did not respond to CNBC’s request for more information on Thursday’s announcement.
Halong Emphasizes some steps GameStop has taken to rebrand and drive growth With the announcement of financial results this spring. He said he launched a redesigned app, attracted new members to its rewards program, and hired people with an e-commerce and blockchain gaming background. By the end of the second quarter, we plan to debut the non-fungible token (NFT) marketplace.
Furlong in a note sent to employees on Thursday and obtained by CNBC The company said it needs to take bold steps when investing in the digital future.
“This means eliminating extra costs and running in the spirit of a strong owner,” he said. “Everyone in the organization needs to be more practical and accountable for the results.”
The company’s stock rose more than 15% during a regular session and then fell more than 6% in extended trading. As of Thursday’s closing price, GameStop’s stock was trading at $ 135.12, with a market value of $ 10.29 billion.
Earlier this week, GameStop said the board Approved a 4: 1 stock split.. A stock split is issued when a company wants to increase the number of shares and keep its price within the reach of more investors. The news spurred a surge of over 8% in stock prices.
Here’s a complete note sent to GameStop employees on Thursday:
As we evolve our commerce business and launch new products through the blockchain group, change will continue. After making significant investments in people, technology, inventory and supply chain infrastructure over the last 18 months, our focus is on achieving sustainable profitability. This means eliminating extra costs and operating in a strong owner spirit. Everyone in the organization needs to be more practical and accountable for the results.
That said, I’m in touch today to share the latest information on the three organizations.
1. After hiring more than 600 companies in 2021 and early 2022, we have a better understanding of our transformation needs. This allowed us to deploy the right number of people across several corporate departments. Today, we’re making some cuts to keep things simple and to have the right people in place and agile.
2. We will invest heavily in store leaders and field employees who play an important role in meeting customer needs. These individuals are, in many ways, the heart of GameStop. We will share more details about this investment in the coming weeks.
3. Mike Recupero, who has been Chief Financial Officer since June last year, will resign. Diana Jaje, Chief Financial Officer of the Company, who has deep institutional knowledge of the business, has been appointed Chief Financial Officer.
These changes will allow us to operate in a profitable way, contrary to our strategy of pursuing sales growth in our commerce business and launching new products that empower our customers in the digital assets and web3 gaming industries. .. We are confident in our future team. We look forward to your continued patronage.
nice to meet you,