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GameStop Layoffs Continue as Company Pivots to Blockchain

GameStop, one of the largest video game retail distributors in the industry, has continued to lay off its staff at both the sales and executive levels
GameStop, one of the largest video game retail distributors in the industry, has continued to lay off its staff at both the sales and executive levels / Jeff Roberson (AP)

GameStop, one of the largest video game retail distributors in the industry, has continued to lay off its staff at both the sales and executive levels.

The company fired its Chief Financial Officer, Mike Recupero, this week, and continued on with another bout of layoffs. Casualties reportedly include a variety of staff from the corporate level, data integrity, and customer service through to Game Informer reporters. (Game Informer is owned by GameStop.) The full scope of the layoffs are unclear.

According to an e-mail CEO Matt Furlong sent July 7, the staff reductions are meant to help the company better perform to meet its new vision.

"Change will be a constant as we evolve our commerce business and launch new products through our blockchain group," CEO Matt Furlong wrote in an email sent to staff Thursday and subsequently published by Kotaku. "After investing heavily in personnel, technology, inventory and supply chain infrastructure over the past 18 months, our focus is on achieving sustained profitability.

"This means elimination [sic] excess costs and operating with an intense owner’s mentality."

With retail game sales continuing to wane, GameStop initiated pivot to blockchain and cryptocurrency, launching its own NFT marketplace and crypto wallet earlier this year. The team allocated to GameStop's crypto ventures has remained untouched by the layoffs, according to one Reddit post from a poster who claims to be a GameStop employee.

The move comes at an interesting intersection for the company as it recently announced a stock split — essentially increasing the number of shares without devaluing them.

Former CFO Recupero will be replaced by Diana Saadeh-Jajeh, Chief Accounting Officer, who will receive a $1,965,000 "transformation bonus" to be paid out in installments over the next year. She'll also receive $1 million in new stock that vests next year in addition to her $200,000 annual salary. Meanwhile, many store-level employees still struggle to make $15 an hour or less.