Ryan Cohen's $35 Billion GameStop Incentive Plan: Can He Deliver Transformation?

GameStop has announced an audacious long-term performance award for CEO Ryan Cohen that could exceed $35 billion if he achieves aggressive growth targets. This marks a significant escalation in how the company is structuring executive compensation, mirroring the approach taken by Tesla with Elon Musk. Rather than guaranteed salary and bonuses, Cohen’s entire compensation package is performance-contingent, creating one of the most ambitious CEO incentive structures in retail history.

The Architecture of an Ambitious Reward

Under the plan, Ryan Cohen can secure stock options to purchase over 171.5 million GameStop shares at $20.66 per share—representing an initial value exceeding $3.5 billion. However, the full reward only materializes if GameStop achieves substantial milestones: $10 billion in EBITDA (earnings before interest, taxes, depreciation, and amortization) and a $100 billion market capitalization.

The structure includes staged vesting, with the first tranche (10% of the total award) unlocking when GameStop reaches a $20 billion market cap and $2 billion in EBITDA. This tiered approach aligns Ryan Cohen’s personal wealth accumulation directly with shareholder value creation.

As of early 2025, GameStop had generated approximately $136 million in EBITDA over nearly 10 months, while trading at roughly a $10.3 billion market valuation. This means the company must increase EBITDA roughly 74-fold and market cap roughly 10-fold to unlock Cohen’s maximum payout—a target that underscores just how transformative the board expects his leadership to be.

The plan awaits shareholder approval at a special meeting scheduled for March or April 2026, making this a pivotal moment for GameStop’s future direction.

Where GameStop Stands: Progress Under Cohen’s Leadership

Since Ryan Cohen assumed the CEO role in late 2023, the company has implemented meaningful operational changes. The brick-and-mortar footprint has contracted strategically, while the collectibles business has surged dramatically—now representing nearly 28% of total revenue through the first three quarters of 2025 and driving significant year-over-year growth.

However, GameStop faces headwinds in two of its largest revenue-generating segments. The hardware business, which sells video game consoles, continues declining (though at a slower pace than before). More troubling is the software business, focused on new and pre-owned game sales, which has experienced a substantial decline. Together, these two segments account for over 70% of current revenue, creating vulnerability.

Despite these structural challenges, Cohen has demonstrated measurable progress. Operating cash flow, EBITDA, and earnings have all improved significantly in 2025 compared to prior years. This suggests Ryan Cohen’s cost discipline and strategic reallocation are beginning to show tangible results.

Evaluating the Incentive Plan’s Realism

The question facing GameStop shareholders is whether the targets embedded in Ryan Cohen’s incentive package are achievable or aspirational. On one hand, Cohen is now more motivated than ever—not only does the compensation plan incentivize him, but he already owns over 9% of outstanding GameStop shares, aligning his personal wealth with all shareholders.

On the other hand, the mathematical challenge is immense. GameStop would need to fundamentally transform its revenue and profitability trajectory. The company currently trades at approximately 27 times its annualized 2025 earnings—a valuation that assumes significant future growth but doesn’t leave much margin for disappointment given the ongoing softness in hardware and software sales.

Ryan Cohen has proven capable in previous ventures, and his focus on operational efficiency is evident. Yet the collectibles business, while growing, remains nascent and unproven at scale. Scaling this while managing the decline in legacy retail operations represents a complex balancing act.

GameStop will likely retain its characteristic price volatility, driven partly by what analysts call “meme magic” and retail investor interest. But beneath that surface-level trading dynamic lies a real transformation story that Ryan Cohen must execute to justify both his compensation and the market’s current valuation.

The company’s board evidently believes in Cohen’s vision—otherwise, they wouldn’t have structured such an aggressive incentive package. Whether that confidence proves warranted will determine whether shareholders ultimately benefit from this bet on transformation.