In a significant leadership change, GameStop has fired its CEO, Matthew Furlong, and appointed billionaire investor Ryan Cohen as executive chairman. The company confirmed Furlong’s termination in a statement on June 7, 2023, without providing an explanation for the decision.
Furlong also resigned from his position as a company director on the same day, leaving the board with only five members.
However, an 8-K report filed with the U.S. Securities and Exchange Commission on June 9, 2021, revealed that Furlong’s contract stipulated a mandatory 24-month employment duration.
The announcement of Furlong’s departure coincided with GameStop’s first-quarter earnings call, during which the company reported significantly lower earnings per share than market estimates. The decline of 133% in earnings per share caused the company’s stock price to plummet to $21, marking a 19% decrease in after-hours trading, according to information sourced from Google Finance.
Furlong assumed the role of CEO in June 2021, around five months after the infamous meme stock frenzy that saw GameStop’s shares surge from $17.25 to $500 within a single month. During his tenure, Furlong spearheaded the company’s foray into nonfungible tokens (NFTs) as a potential revenue stream.
In June 2022, GameStop entered the NFT (non-fungible token) market by launching its own NFT marketplace. However, the market’s enthusiasm for NFTs was waning at that time. GameStop later expanded its support for blockchain games and NFTs on the marketplace through a partnership with Web3 gaming platform and Ethereum layer-2 scaling solution, ImmutableX.
While the launch of GameStop’s NFT marketplace initially generated approximately $2 million in sales on its first day, sales quickly declined. By August, daily sales averaged around $4,000, reflecting a staggering 99.8% decrease from the opening-day frenzy.
After a disappointing Q3 earnings report, which revealed a net loss of $94.7 million and led to staff reductions, GameStop announced in December 2022 that it would no longer allocate substantial resources to cryptocurrencies or NFTs. Despite this announcement, the company recently partnered with Illuvium, an Australian blockchain game developer, to launch a collection of 20,000 NFTs.
Furlong or his associates had not issued a statement about the development as of press time.
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