GameStop Raises the Stakes, Tying CEO Pay to ‘Extraordinary’ Growth Targets Like Tesla
Mondeum Capital (UK) Limited
GameStop Corp. is revamping Chief Executive Officer Ryan Cohen’s compensation to mirror the kind of long-term, performance-based incentives popularized by Tesla Inc., dangling a potentially massive equity award tied to extraordinary growth targets.
Under the plan, Cohen would be eligible for a large stock-options package if he can lift GameStop’s market capitalization to $100 billion from about $9.3 billion — an increase of roughly tenfold — and steer the videogame retailer to sustained profitability. The proposal comes after a lackluster period for the company’s shares, which have struggled to maintain momentum following bouts of retail-investor enthusiasm.
In addition to the market-value hurdle, Cohen must guide the company to what GameStop describes as $10 billion in “cumulative performance” earnings before interest, taxes, depreciation and amortization. The targets are designed to reward long-term value creation rather than short-term stock-price gains, according to the company.
The structure echoes the compensation framework used at Tesla, where outsized equity awards have been tied to aggressive market-cap and operational milestones. For GameStop, the plan underscores the scale of the turnaround Cohen is being asked to deliver — and the magnitude of the payoff if he succeeds.
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