GameStop shares slide 6% as finance chief exits retailer 

Games retailer had been trying to revive growth as customers switch from buying physical discs to digital downloads

GameStop was emblematic of the meme-stock craze where traders bid up the price of certain firms prompted by chatter on social media rather than business fundamentals.

Shares in GameStop, the games retailer, tumbled on Friday, a day after the company fired its chief financial officer and said it is cutting jobs in a bid to turn around a business buffeted by shifting gaming demands and market malaise. The shares fell 6% at one stage. 

Diana Jajeh, the current chief accounting officer, will replace Mike Recupero, effective immediately, GameStop had said. 

The struggling video game retailer is making a “number of reductions” to staff, according to a company memo. The cuts will be felt across the parent company and Game Informer, an online magazine.

Ryan Cohen, who joined the board and became chairman last year, has been trying to revive growth at beleaguered GameStop, which has slowed as gamers shifted from buying game discs to digital downloads. During the pandemic, GameStop became emblematic of the so-called meme-stock craze whereby retail traders bid up the price of certain companies, prompted by chatter on Reddit and other social media, rather than business fundamentals.

“After making more than 600 corporate hires in 2021 and the first half of 2022, we have a stronger understanding of our transformation needs,” GameStop chief executive Matt Furlong said in the memo. 

The company is also coming to grips with a clash about strategy between recent hires, many from e-commerce giant Amazon, and GameStop staffers with a background in brick-and-mortar game sales.

GameStop had recently hired several Amazon employees in an effort to shift its focus from physical storefronts to e-commerce. 

• Bloomberg