Shares of GameStop suffered their worst ever one-day drop after the struggling video game retailer reported falling sales and scrapped its dividend. GameStop Corp. (GME) on Tuesday reported fiscal first-quarter earnings of $6.8 million.
The Grapevine-based company said it had profit of 7 cents per share.
The results surpassed Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for a loss of 2 cents per share.
The video game retailer posted revenue of $1.55 billion in the period, which missed Street forecasts. Three analysts surveyed by Zacks expected $1.67 billion.
GameStop shares have fallen 38% since the beginning of the year, while the Standard & Poor’s 500 index has risen 12%. In the final minutes of trading on Tuesday, shares hit $7.83, a fall of 45% in the last 12 months.
On May 30, GameStop announced new leadership appointments and an enhanced organizational structure to better position the company for continued execution of its transformation and drive its next phase of growth. Under the enhanced organizational structure, which includes newly created chief customer officer and chief merchandising officer roles, the leadership team will report directly to George Sherman, who was appointed as CEO in April.
The new executives are:
• James Bell, age 51, appointed as Executive Vice President and Chief Financial Officer, effective June 3, 2019. /Bell most recently served as CFO of Wok Holdings, Inc., the parent company of P.F. Chang’s, Pei Wei and True Food Kitchen restaurants, where he successfully designed and led the company’s overall strategic plan and omni-channel digital transformation that resulted in over $50 million in annual revenue growth over two years. Previously, he served as EVP, CFO at RLH Corporation and Coldwater Creek, Inc. Earlier in his career he held senior finance roles at several consumer businesses, including Harry & David Holdings, Inc. and The Gap. Jim previously served as a Naval Flight Officer in the U.S. Navy from 1989 to 1998.
Rob Lloyd, the company’s current Chief Operating Officer and Chief Financial Officer, will depart after nearly 23 years with GameStop, effective July 3, 2019. He will work with Sherman and Bell to ensure a smooth transition during the month of June. As part of its new organizational structure, the company will eliminate the position of COO.
• Chris Homeister, age 50, appointed to newly created role of Executive Vice President and Chief Merchandising Officer, effective June 10, 2019. Homeister most recently served as President, CEO and a member of the Board of Directors of The Tile Shop, a publicly traded specialty retailer, where he grew the company in terms of product assortment, online and mobile capabilities, store count, employees, revenue and EBITDA. Earlier in his career, he held a number of senior roles at Best Buy, including SVP, Digital Merchandising & Strategic Planning and General Manager and SVP, Entertainment Business Group, where he oversaw the product categories including video games, movies, music, and eReaders and launched Best Buy’s video game trade-in business. In the newly created CMO role at GameStop, Chris will be responsible for the company’s overall merchandise operations and strategy and all product and merchandising functions across all channels, including buying, planning, supply chain and logistics, and inventory allocation efforts.
• Frank Hamlin, age 50, promoted to the newly created role of Executive Vice President and Chief Customer Officer, effective June 3, 2019. Hamlin has more than 25 years of experience in retail marketing, strategy, customer loyalty and e-commerce, and previously served as GameStop’s Chief Marketing Officer. Prior to GameStop, he served as CMO of Tailored Brands, the parent company of Men’s Wearhouse, JoS. A. Bank and Joseph Abboud and held various marketing and operations leadership positions of increasing responsibility at Guitar Center; E-Miles LLC; H.E. Butt Grocery; and Brierley & Partners. In this newly created role, Frank will have responsibility for defining and driving the company’s overall customer-centric initiatives as it relates to marketing, customer loyalty, the omnichannel business, strategy and innovation.
“The new leadership appointments and changes to our organizational structure mark important milestones that will help advance GameStop’s transformation as we work to position the company for the future and bring gaming culture and experiences to life in every community,” Sherman said. “With this experienced and dynamic team in place, we will be better positioned than ever to execute on our strategic priorities and meet our loyal customers where, when and how they want to shop. Importantly, we remain focused on driving long-term growth and profitability and further strengthening our balance sheet to deliver increased value to our shareholders, employees, customers and other stakeholders.”
FWBP Staff, Associated Press
Parts of this story was generated by Automated Insights(http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on GME at https://www.zacks.com/ap/GME