In the spirit of Christmas and the ruthless pursuit of meme stock shareholder value, GameStop carried out its latest round of layoffs on Monday ahead of its new earnings report, which is due out later this week. The cuts reportedly hit staff working on the company’s crypto push, as well as a number of other departments within its corporate offices.
“Now that we are emerging from the rebuilding phase of our transformation, GameStop has a strong foundation from which to pursue profitability in the near-term and sustainable growth over the long-term,” CEO Matt Furlong wrote in an email to staff, a copy of which was obtained by Kotaku, But the foundation was apparently not strong enough to forgo pink slips for some employees just a few weeks ahead of the holidays.
News of the layoffs first came from Axios, which reported that the team building GameStop’s blockchain wallet was “heavily impacted.” It also pointed to LinkedIn posts from numerous employees, including software engineers and staff in the e-commerce department. Furlong did not specify the extent of the cuts in his email, which instead made cryptic reference to a number of “headcount reductions” across various teams.
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“We’ve recently completed several projects that were part of the initial phase of our transformation and enable the business to operate with increased efficiency,” he wrote. “In addition, we’ve continued to gain clarity regarding he right level of corporate staff needed to achieve our profitability and growth goals. These two factors informed the decision that were taken across the organization.” Furlong blamed the “proactive” but “difficult” decision to lay off people off in part on high inflation and “weakened consumer confidence” amid the record job market.
This is the third round of layoffs at GameStop’s corporate offices this year, even as its share price continues to be over 500 percent up from where it was before the meme stock boom. One thing that certainly didn’t help was hitching promotion of its crypto marketplace to FTX, whose parent company recently went bankrupt after the founder and CEO was revealed to have no idea where he had placed billions of dollars.
But it’s been an incredibly hard time for frontline employees in GameStop’s stores as well. A software overhaul earlier this year ruined inventory records, leading to a pre-order clusterfuck that has continued past the Black Friday shopping season. Store managers, meanwhile, are being forcibly recruited into a new program in which they oversee double the locations for only $1.50 more in hourly pay. Their reward for the trouble is the promise of meme stock bonuses.
Unfortunately, none of it will start paying out until next year. Furlong, meanwhile, probably has a nice holiday lined up ahead of him. He made $16.8 million last year.