FILE PHOTO: A GameStop store is pictured in the Manhattan borough of New York City, New York, U.S., January 29, 2021. REUTERS/Carlo Allegri/File Photo/File Photo/File Photo
GameStop (GME) stock is up by over 8% as of 7:20 a.m. EDT in today's pre-market trading. The company said today that George Sherman will be stepping down as Chief Executive Officer on July 31, 2021, or earlier upon the appointment of a successor. Yes, the company is preparing for its a major strategic transformation.
The company said that the board's strategic planning and capital allocation committee is leading a search to identify Chief Executive Officer candidates with the capabilities and experience to help accelerate the next phase of the company's transformation. The company previously has already appointed a chief technology officer, hired two executives to lead customer services and e-commerce fulfillment.
The company previously said that it will transform from a video game retailer to an e-commerce company so as to compete with the likes of Amazon. This transformation will deal with the long term threat of the digital game download to its brick-and-mortar retail business.
The strategy of focusing on online sales and abandoning physical stores is correct. Gamers are increasingly inclined to download games online, especially during the pandemic. At the same time, this strategy can also help the company to reduce its operating costs.
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