GameStop Stocks Soared, New CEO’s Company Reform

GameStop Stocks Soared, New CEO’s Company Reform

On Wednesday, June 9, GameStop stocks soared before it was due to release its quarterly results.

The company’s stock extended and was on track in ending the session at its highest closing price since January.

It had reached an all-time high of $483 at the beginning of the year before sinking and then rallying again.

On Wednesday’s close, the stock rose 0.85%, or a net gain of $2.56. 

This sent the stock price higher at $302.56 per share.

It is expected to open Thursday’s session with a fall of $5.21% to $286.80 per share.

GameStop’s sales came in at $1.28 billion in the fiscal first quarter that ended last May 1.

This is higher in comparison to analysts’ forecast of $1.17 billion.

However, the firm lost 45 cents per share, excluding some items. 

This loss is a bit smaller than the projected deficit of 71 cents.

The video game retailer’s short sellers currently have $3 billion at stake. 

This is an increase from the $1.3 billion it recorded at the end of 2020.

Analysts are expecting a revenue of $1.16 billion on average for the quarter ending in April.

Ryan Cohen, who was the top shareholder, was announced as the new chairman.

He plans to transition the company into an eCommerce business that can take on big-box retailers. 

This was due to analysts warning that its rising stock price became disconnected from its business.

It is because gamers started to transition in downloading games digitally or in streaming.

As a result, the firm lost a huge amount of money for the past three years.

New Executives

Also, on Wednesday, GameStop announced that the former head of Amazon’s Australian firm would be its new chief executive.

The video game retailer stated that the appointment was aimed to sell new shares and to transform the struggling company whose stock surged this year.

The nine-year Amazon veteran, Matt Furlong will replace George Sherman as the company’s chief executive officer.

Another one would be Mike Recupero, a 17-year chief financial officer at the U.S.’ Amazon consumer business, who will succeed Jim Bell as CFO.

On June 21, Furlong will be joining the company while Recupero will step up on July 12, the company stated.

The appointment of a new CEO and CFO happened following reports that the company was looking for a replacement for Sherman.

In a statement, GameStop said that these substitutions reflect the renewed Board’s focus on building a tech firm and investing in growth.