GameStop stock sinks 17% after quarterly earnings and revenue miss expectations

• GameStop shares lost as much as 17% early Wednesday following the retailer's fourth-quarter financial report.
• Adjusted earnings of $1.34 a share fell short of the $1.35 a share anticipated by Wall Street.
• GameStop named Jenna Owens, a veteran of Amazon and Google, as its new COO.

GameStop shares dropped early Wednesday after the video game retailer's fourth-quarter earnings missed Wall Street's estimates in the first financial report since the Reddit-driven rally two months ago.

The company late Tuesday posted adjusted earnings of $1.34 per share, shy of the adjusted $1.35 per share average projected by analysts polled by Refinitiv. Revenue of $2.12 billion fell short of the $2.21 billion average projection.

Shares of GameStop fell as much as 17% to $151.02 ahead of the opening bell then slightly pared the loss to 14%. Just after the report was released late Tuesday, the shares spiked up by nearly 8% before losing steam.

Adjusted earnings from the retailer, which has been working on a "transformation" plan, rose from $1.27 per share a year ago. Revenue a year earlier was $2.19 billion.

GameStop, whose shares were championed by retail investors active on Reddit's Wall Street Bets community, named Jenna Owens as its new chief operating officer on Tuesday. Owens joins the company after working in executive roles at Amazon and Google . Ecommerce sales are a key focus in GameStop's business strategy, with the company noting that fourth-quarter online sales climbed by 175%. Same-store sales rose by 6.5%.

"Our emphasis in 2021 will be on improving our E-Commerce and customer experience, increasing our speed of delivery, providing superior customer service and expanding our catalogue," George Sherman, GameStop's chief executive, said in the earnings statement.

GameStop recently said Ryan Cohen, cofounder of pet products retailer Chewy and GameStop's largest individual shareholder, will be in charge of a committee aimed at driving a turnaround plan.

Shares of GameStop have soared from roughly $4.20 over the past year, hitting an intraday high of over $450 at the peak of the retail-trading frenzy in late January.