GameStop Appoints Chewy Founder Ryan Cohen as CEO to Revamp Business
Ryan Cohen, the billionaire founder of Chewy, has been appointed as the CEO of GameStop in an effort to overhaul the struggling video game retailer. Cohen, who is already the largest individual investor and chairman of GameStop’s board, takes on the role following the removal of former CEO Matthew Furlong. Furlong had been brought in two years ago to lead the company’s turnaround but was ousted by executives. GameStop has faced challenges due to poor sales, executive turnover, and competition from online retailers like Amazon.
Despite the appointment, some analysts remain skeptical about GameStop’s future. The company has experienced a 38% stock plunge and a one-third revenue decline since 2014. Michael Pachter of Wedbush Securities noted that Cohen lacks significant experience in managing a physical retailer and that GameStop lacks clear direction. Pachter believes that without a turnaround plan and with the shift toward digital game downloads, Cohen’s appointment may lead to GameStop’s demise.
Cohen will continue serving on GameStop’s board while taking on his new roles as president, CEO, and chairman. He will not be receiving compensation for these positions. GameStop made headlines in 2021 when its stock price surged by over 1,000% due to support from smaller investors driven by the Reddit community WallStreetBets. This event showcased the power of a new generation of investors using mobile trading apps. The rise of GameStop’s stock was followed by similar trends for other struggling stocks, with some participants seeing it as an opportunity to challenge hedge funds.
The GameStop meme stock phenomenon was even the inspiration for a movie titled “Dumb Money.” The company’s shares experienced a 1% decline in early afternoon trading.
The Associated Press contributed reporting.
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