GameStop Names Ryan Cohen Exe. Chair, Fires CEO Matthew Furlong

GameStop Corp. disclosed that its Board of Directors has elected Ryan Cohen as Executive Chairman, effective immediately. In a filing with the U.S. Securities and Exchange Commission, the video game retailer said its Board on June 5 terminated Matthew Furlong as President and Chief Executive Officer with immediate effect.

The announcement comes as the company reported a narrower loss in its first quarter, but below market estimates, amid weak revenues.

Following the news, GameStop shares plunged around 19.2 percent in the extended trading on the NYSE.

As per the filing, Furlong was no longer employed by GameStop Texas Ltd., GameStop, or any of their affiliates. He will be entitled to receive the payments and benefits associated with a termination without cause.

Furlong also resigned as a director of the company, effective immediately. The company noted that Furlong’s resignation did not result from any disagreement with it on any matter relating to the operations, policies or practices.

In connection with Furlong’s resignation, the Board reduced its size to five. Additionally, the Board appointed Cohen as Executive Chairman and Alain Attal as the Lead Independent Director of the Board.

Regarding Cohen, the company said the responsibilities include capital allocation, evaluating potential investments and acquisitions, and overseeing management.

Further, the Board appointed Mark Robinson as the company’s General Manager as well as principal executive officer. He will report directly to Cohen. Robinson will continue to serve in his roles as the General Counsel and Secretary of the company.

In its first quarter, GameStop reported net loss of $50.5 million, or $0.17 per share, compared to prior year’s loss of $157.9 million or $0.52 per share.

Adjusted loss was $42.3 million or $0.14 per share for the period. Analysts on average had expected the company to report loss of $0.12 per share, according to figures compiled by Thomson Reuters. Analysts’ estimates typically exclude special items.

The company’s revenue for the quarter fell 10.1 percent to $1.24 billion from $1.38 billion last year.

On Wednesday’s regular trading, GameStop shares closed at $26.11, up 5.75 percent. However, in the after hours trading, the shares fell 19.2 percent to trade at $21.09.

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