GAMESTOP, the struggling video-game retailer, fired Matt Furlong, its chief executive officer (CEO) for the past two years, and said chairman Ryan Cohen will take on a new executive role. The shares plunged more than 20 per cent.

Cohen’s responsibilities as executive chairman of the video game chain will include management oversight and capital allocation, the company said on Wednesday (Jun 7) in a statement. GameStop’s general counsel, Mark Robinson, will become general manager and principal executive officer.

The money-losing retailer also reported fiscal first-quarter sales that fell short of analysts’ estimates. Revenue in the period ended Apr 29 fell to US$1.24 billion, missing estimates of US$1.34 billion. The loss in the quarter narrowed to 14 US cents and was smaller than the 17 US cents analysts projected.

GameStop has struggled to adapt to the increasing share of game sales conducted online and away from stores. Annual sales have plunged from a recent peak of US$9.36 billion to US$5.93 billion last year.

Furlong delivered a profitable holiday quarter for the company, in part due to job cuts and store closings. Cohen said at the time that GameStop would become a much healthier business. The company said in a filing on Wednesday that while Furlong was fired as CEO, his resignation from the board “did not result from any disagreement with the company”.

Cohen is the chain’s largest shareholder with 12 per cent of the stock. Shortly after GameStop announced Furlong’s departure, Cohen posted a message on Twitter that appears to be a play on his name.

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Cohen is the founder of Chewy.com. Despite a historic run-up in GameStop shares in 2021 during the meme-stock craze, he has failed to capitalise on interest in the brand. Management has unsuccessfully experimented with Web3 and a variety of business models for its brick-and-mortar stores.

In its filing, the company said it continues to focus on “three overarching goals: establishing omnichannel retail experience, achieving profitability and leveraging brand equity to support growth”.

Shares of GameStop fell as low as US$19.89 in extended trading after the announcements. The shares were up 41 per cent this year through the close on Wednesday in New York. BLOOMBERG