GameStop cutting salaries, including 50% for the CEO, as it deals with COVID-19

Posted: April 23, 2020 in Game Articles

gamestop

by Brian Womack via Dallas Business Journal

GameStop Corp. is cutting back on pay amid the challenges with COVID-19 – with the bigger cuts earmarked for the higher-ups.

The troubled Grapevine retailer (NYSE: GME) is temporarily reducing the salary of CEO George Sherman by 50 percent, the company said in a statement. There is a 30 percent reduction for CFO Jim Bell and the remainder of the executive leadership team.

“Certain other employees” across its units also will get cuts of between 10 percent and 30 percent temporarily. GameStop offered “certain” corporate support staff the option to temporarily furlough or take a reduced work week or pay program.

GameStop is looking for ways to find traction amid the onslaught of COVID-19 and the restrictions that have been put on its sites under shelter-in-place rules.

Since the company closed stores to the public on March 22, it retained more than 90 percent of planned sales volumes in the two thirds of the stores conducting curbside operations. Still, comparable store sales for the nine-week period ended April 4 dropped about 23 percent.

“We believe our aggressive focus on expense, inventory and capital expenditure reductions will help preserve our financial health as we work to ensure readiness and ramp up operations as soon as conditions allow,” Sherman said in a prepared statement. “The situation remains very fluid and a great deal of uncertainty remains, however, we entered into this time with a strong balance sheet and believe that we have sufficient cash and liquidity for the foreseeable future.”

With retail under pressure, the company did not make a portion of certain lease payments and remains in discussions with landlords.

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