GameStop Boosts Compensation for Some Store Employees With Shares and Raises



GameStop Corp.


GME -3.07%

plans to reward thousands of employees with stock and pay raises, returning focus to its bricks-and-mortar business as the company looks to become profitable under new leadership.

The videogame retailer, which had pivoted last year to growing online sales, is trying to do more to motivate and retain the employees at its stores, according to a Wednesday memo to employees reviewed by The Wall Street Journal.

The company plans to award stock to all of its U.S. store leaders and give raises to some senior store staff. Store leaders will receive up to $21,000 in stock, which will vest over three annual installments.

The financial awards will start next month, Chief Executive

Matt Furlong

said in the memo. Mr. Furlong didn’t specify what amount of time employees would need to have worked at the company to qualify for the raises.

“After spending a year strengthening our assortment, infrastructure and tech capabilities, we’re now focused on achieving profitability, launching proprietary products, leveraging our brand in new ways and investing in our stores,” Mr. Furlong said in the memo. “While we continue evolving our e-commerce and digital asset offerings, our store fleet will remain critical to GameStop’s value proposition.”

The company is investing between $45 million to $50 million in the new employee-compensation initiative, according to a person familiar with the matter. It applies only to staff at the company’s more than 3,000 locations in the U.S., this person said.

Last year, GameStop was at the center of a monthslong, social-media-fueled trading frenzy.

Chewy Inc.

co-founder

Ryan Cohen,

who had taken a large stake in the company, pushed for new leadership in hopes of turning its fortunes around. GameStop has posted annual losses for years.

Amateur investors took the stock market by storm a year ago, buying up shares of meme stocks like GameStop and AMC Entertainment. Many remember it as a revolution against Wall Street, but in the end, they largely just lined the pockets of major financial firms. WSJ’s Dion Rabouin explains. Illustration: Sebastian Vega

Mr. Furlong joined GameStop in mid-2021 as part of Mr. Cohen’s overhauling of the company’s executive team and board of directors. Mr. Cohen also was elected chairman last year.

GameStop has spent much of the past year on efforts to revamp and grow its e-commerce operations, including by leasing more fulfillment centers and adding a new customer-service facility in Florida. The company launched a marketplace for trading nonfungible tokens, digital assets commonly referred to as NFTs.

In the quarter through April, Grapevine, Texas-based GameStop said sales increased as its loss widened. The company’s shares have fallen more than 35% over the past 12 months. The Nasdaq Composite Index fell less than 20% over the same period.

Write to Sarah E. Needleman at sarah.needleman@wsj.com

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Appeared in the August 25, 2022, print edition as ‘GameStop Boosts Pay, Refocuses On Stores.’

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