GameStop has terminated the employment of its CEO Matthew Furlong and swiftly named Ryan Cohen, the current board chairman, as the new executive chairman, effective immediately, according to the company's announcement on Wednesday.

Following the announcement of the CEO termination, GameStop's shares experienced a decline of over 20% in after-hours trading. The video game retailer disclosed this news on the same day it reported a decrease in revenue and a narrower loss for its fiscal first quarter, as compared to the corresponding period of the previous year.

As per a CNBC report, GameStop did not disclose the reason behind the CEO's termination but acknowledged the change in its quarterly securities filing.

“We believe the combination of these efforts to stabilize and optimize our core business and achieve sustained profitability while also focusing on capital allocation under Mr. Cohen’s leadership will further unlock long-term value creation for our stockholders,” the filing states.

In 2020, Ryan Cohen acquired a stake in GameStop, and in January 2021, he, along with two other former Chewy executives, joined the retailer's board as part of a management agreement. Cohen's investment firm, RC Ventures, presently holds an 11.9% ownership interest in GameStop, as reported in filings.

In a distinct securities filing, GameStop revealed that Matthew Furlong was terminated on Monday and stated that he will be entitled to receive payments and benefits typically provided in cases of termination without cause. Furthermore, Furlong also resigned from his position on the company's board on the same day, resulting in the board now consisting of only five members.

According to the filing, Ryan Cohen will assume responsibility for capital allocation, assessing potential investments and acquisitions, and supervising the managers of GameStop's holdings.

Shortly after the announcement of Furlong's termination, Ryan Cohen, the activist investor and founder of Chewy, tweeted a cryptic message saying, "Not for long," approximately thirty minutes later. 

Cohen is renowned for being reticent in public and frequently making ambiguous statements online. The choice to separate from Furlong comes only a few months after GameStop, under his leadership, reported its first quarterly profit in two years.

According to the CNBC report, as part of the leadership reorganisation, Alan Attal, a former executive of Chewy and a current member of GameStop's board, has been appointed as the lead independent director of the board, as stated in the filing.

According to the filing, Mark Robinson, the general counsel of GameStop, has been appointed as the general manager and principal executive officer of the retailer. In his new role, Robinson will be responsible for various tasks, including administrative matters, corporate development, legal affairs, and providing support for GameStop's holdings. Additionally, he will oversee other executive officers, apart from Ryan Cohen.

As per the announcement, Robinson will directly report to Cohen and will retain his roles as the general counsel and secretary of GameStop.

In June 2021, Furlong assumed the role of GameStop's CEO during a critical phase of the company's turnaround plan. At that time, GameStop was in the process of transitioning from a traditional brick-and-mortar retailer to an online player, aiming to establish itself as a formidable competitor to the likes of Walmart, Sony, and Microsoft. Furlong, a former executive at Amazon, was appointed to lead GameStop through this transformation.

Before assuming the position of GameStop's CEO, which lasted approximately two years, Furlong had a tenure of nearly nine years at Amazon. 

In his most recent role, he played a crucial role in driving the growth of Amazon's business in Australia. Prior to that, Furlong served as a technical advisor to the head of Amazon's North America consumer business and gained experience working at Procter & Gamble.