GameStop’s survival demands ‘extreme frugality,’ CEO Ryan Cohen tells employees

Just hours after being named GameStop‘s CEO, Ryan Cohen sent out a memo to employees Thursday that emphasized he will take dramatic steps to ensure the struggling video game retailer survives.

“Our job is to make sure GameStop is here for decades to come,” he wrote in the email that was sent to corporate employees and store leaders and obtained by CNBC. “Extreme frugality is required. Every expense at the company must be scrutinized under a microscope and all waste eliminated. The company has no use for delegators and money wasters. I expect everyone to treat company money like their own and lead by example.”

Cohen, a billionaire activist investor and founder of direct-to-consumer pet food and supply retailer Chewy, was named the company’s new leader Thursday morning. He was previously executive chair of GameStop. As of late June, his firm RC Ventures was the company’s largest shareholder with a 12.09% stake, according to FactSet.

Cohen’s CEO announcement previewed the company’s emphasis on slashing costs: He will not receive a salary in his new role.

Cohen became an integral part of the “meme stock” frenzy, as he invested in companies including now bankrupt Bed Bath & Beyond. He joined GameStop’s board in 2021 in the thick of the phenomenon.

Cohen’s new role kicks off the latest chapter of GameStop’s effort to reinvent itself. The Grapevine, Texas-based retailer, which was founded in the 1980s, built its business on selling video games, consoles and other gaming merchandise.

Yet as customers buy video games online, it has fallen from relevance and had to chase new ways make money. It has experimented with new businesses, such as launching an NFT marketplace and striking a partnership with now bankrupt cryptocurrency exchange FTX.

The company has also dealt with major leadership changes. With Cohen on its board, GameStop tapped multiple Amazon veterans, including…