GameStop Plans To Re-Open Stores As It Cuts Executive Pay

GameStop is one company that found itself at the center of a lot of controversy in the early days of the coronavirus pandemic. As leaders around the world put their states and countries on stay-at-home orders, GameStop attempted to argue that it was an essential business and should remain open. Add to that reports from anonymous GameStop employees claiming that the company wasn't doing enough to protect them, and GameStop wound up catching a lot of heat for how it handled itself during the pandemic.

Eventually, though, GameStop gave in, announcing that it would shut down many of its stores in the US and begin offering only curbside pickup at some. Fast forward a few weeks and now the company is announcing that it will re-open stores in some parts of the world. In addition, it will cut the salaries of its executives and some of its other employees.

Those executives who will see their salaries reduced include CEO George Sherman, who is taking a 50% pay cut; CFO Jim Bell "and the remainder of the executive leadership team," will all see a 30% salary cut. Furthermore, GameStop says that the "Board of Directors has temporarily reduced cash compensation to directors by 50%." Beginning on April 26th, certain employees in GameStop's worldwide operating units "will receive temporarily reduced pay of between 10% and 30%," as well.

Beyond the pay cuts, GameStop noted today that approximately one-third of its retail locations in the US are closed entirely, while the other two-thirds are operating as curbside pickup only locations. The company say that it has already started the process of re-opening stores in Italy, Germany, and Austria. The same is true in South Carolina and Georgia, with GameStop saying that it is "preparing for the potential to re-open in other operating countries and states in the coming weeks."

Whether that means we'll see these stores operate as curbside pickup only locations remains to be seen, though GameStop did say that at locations where curbside pickup is available, it's managed to retain more than 90% of its planned sales volumes. We'll see what happens from here, but we can't help but wonder if GameStop might be jumping the gun in looking to re-open stores.