GameStop (GME) shares are up in early trading as the company appoints billionaire Ryan Cohen as the new CEO. This comes three months after the company fired CEO Matthew Furlong.
Yahoo Finance Live breaks down the news. For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
BRAD SMITH: Let's shift gears here and talk a little GameStop on the day. Taking a look at shares of GME. Shares are higher by about 2.4%. The company announced this morning that they are naming Ryan Cohen as Chief Executive Officer.
This comes three months after GameStop fired their last CEO. The billionaire bought a stake of GameStop in 2020 and joined the board a year later, during the height of the meme stock phenomenon. What we should also note is that he will not be taking a salary in this role.
BRIAN SOZZI: Well, that's mighty nice of him.
BRAD SMITH: Yes.
BRIAN SOZZI: Wow.
BRAD SMITH: That doesn't matter to you, I know.
BRIAN SOZZI: No. It's ridiculous. Here's another executive that, by and large, people have strong feelings about Ryan Cohen, that he's failed at GameStop. And I think all signs pointed to him, Brad, taking this CEO role.
He has really a board of his own hand-picked puppets, people that he used, his hand selected to join that board that he worked with at Chewy, people that he feels comfortable with. They are unlikely to tell Ryan Cohen no. But by and large, zoom out of this situation and you have Ryan Cohen, who has fundamentally failed at changing a company like GameStop. And why?
Because there is no change in GameStop, Brad. This is a fundamentally challenged market. You have digital downloads, you name it. And I know there's a lot of really hardcore believers remaining out there on Reddit and the GameStop story and Ryan Cohen, but he has absolutely failed at fixing this company. All he has done is successfully laid off a lot of former Amazon workers.
BRAD SMITH: Top trending ticker on Yahoo Finance this morning, GME, and of course, as it naturally is, especially on a move like this, this is going to be effective immediately, we should note. And then additionally here, you had a question, what the actual trajectory from a strategic perspective is from GameStop at this point in time. I mean, inventory is largely shifting to being delivered over the cloud. You've got a deal that's going to be done, perhaps, and is expected to be done, if you were to look at shares of Activision Blizzard at this point, expected to be done between Microsoft and Activision Blizzard. That's going to just further consolidate the gaming landscape as well.
So where does GameStop sit within that? Where you've got so many people just going to the cloud to make purchases. It just makes them a T-shirt company or a T-shirt retailer at the end of the day. And maybe you can get a couple of Funko dolls there.
BRIAN SOZZI: Well, no, maybe Calvin McDonald over at Lululemon could take all those unsold MIRROR devices and just stick them into GameStop, Brad. And maybe we can liquidate them that way. There's thousands of GameStop stores. I know, we're thinking in real time.
BRAD SMITH: Yeah, exactly.
BRIAN SOZZI: This is innovation right here.