GameStop Corp.’s

finance chief was forced out of his role as activist investor

Ryan Cohen

pushes for a digital transformation of the ailing videogame retailer, people familiar with the matter said.

The Grapevine, Texas-based company announced Tuesday that Chief Financial Officer

Jim Bell

will depart the business March 26, but didn’t give a reason. His exit isn’t related to the Reddit-fueled frenzy for the stock, these people said. Mr. Bell didn’t immediately respond to a request for comment.

Tuesday’s CFO exit is one element of the broader cleanup effort at GameStop, the people familiar with the matter said. Mr. Cohen, the co-founder of online pet-food retailer

Chewy Inc.,

last November disclosed a nearly 10% stake in GameStop through his investment firm RC Ventures LLC. At that time, Mr. Cohen sent a letter to GameStop’s board urging it to conduct a strategic review of the business and reduce its reliance on physical retail, focusing on e-commerce instead.

Although the company’s market value temporarily ballooned this year, and its stock made substantial gains on Wednesday, the bricks-and-mortar retailer’s business hasn’t changed as dramatically. Revenue has been shrinking at the roughly 5,000-store chain for several years. It faces the same fundamental challenge as booksellers and music retailers before it: a shift from physical copies to digital downloads. The company has also faced growing competition from

Walmart Inc.

and

Amazon.com Inc.

and experienced high executive turnover.

Since then, Mr. Cohen has pushed for several changes at the videogame retailer.

In January, GameStop said it had reached a deal to have Mr. Cohen, Chewy’s former Chief Operating Officer

Alan Attal

and former Chewy CFO

Jim Grube

join its board. RC Ventures agreed to increase its stake to no higher than 19.9% for several months.

GameStop also made several key appointments to drive the business overhaul. The company earlier this month announced that it hired Matt Francis, a former Amazon.com Inc. executive, who took on the newly created role of chief technology officer on Feb. 15. It also recruited Josh Krueger—who previously worked at Amazon and Walmart—as vice president of fulfillment. Kelli Durkin, who held the role of vice president of customer service at Chewy, is GameStop’s new senior vice president of customer care.

Mr. Cohen has said he plans to modernize the company by focusing more on e-commerce and opportunities in tech-driven areas such as esports and mobile gaming, according to a November filing with the Securities and Exchange Commission. He also wants GameStop to end leases at underperforming stores and close nonessential operations in Europe and Australia to pay for technology improvements. The company currently operates in 10 countries.

A potential turnaround at GameStop isn’t something Wall Street is betting on yet. The company, particularly Mr. Cohen, needs to develop a strategy for growth and use it to re-engage institutional investors, many of whom have shorted the stock, said Michael Pachter, a research analyst at financial-services firm Wedbush Securities Inc. “That is a real challenge,” Mr. Pachter said. “But if Ryan Cohen starts to show that they are a growth story, then institutions will come back, the stock will work and everybody makes money.”

Industry analysts see many lucrative revenue options for GameStop, including leveraging its brand recognition and reach within the gaming community.

GameStop should focus on its community and encourage people to come into its stores, said Ray Wang, an analyst at advisory firm Constellation Research Inc. “To do the whole Blockbuster-to-Netflix thing, you have to bring that community back to GameStop, from where they’ve gone to other social-media sites,” Mr. Wang said.

GameStop said it has launched its search for a new CFO, and plans to appoint its Chief Accounting Officer Diana Jajeh as interim finance head if it hasn’t found a replacement when Mr. Bell leaves. The company is seeking a CFO with a background in e-commerce or technology who could develop strategies in areas such as capital allocation and financing, the people familiar with the matter said.

Write to Nina Trentmann at [email protected] and Mark Maurer at [email protected]

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