EA Chief John Riccitiello Still Isn't Fired

[Andy Chalk]

EA Chief John Riccitiello Still Isn't Fired

Electronic Arts continues to have a "very high level of confidence" in its management team.

Earlier this month, analyst Michael Pachter said that Electronic Arts CEO John Riccitiello was sweating a little over his long-term prospects at the company. EA's stock is in the tank, currently sitting at less than half of Take-Two's value when EA tried to take it over in 2008, and Riccitiello, according to Pachter, can't figure out why. "I had lunch with John Riccitiello last week. He was asking me why no one wants to buy his stock," Pachter claimed [http://www.develop-online.net/news/41363/Pachter-EAs-Riccitiello-fears-for-his-job]. "He doesn't understand what's going wrong."

But at today's meeting of EA shareholders, Chairman Larry Probst put the rumors of Riccitiello's imminent demise to rest. EA's board of directors monitors the management team and discusses long-term succession plans "on a regular systematic basis," he explained, and right now they're pretty happy with the job he's doing.

"The board has a very high level of confidence in John and the management team," Probst said. "They have done a really good job of exceeding the operating plans in the last few years."

I have no idea what that operating plan might be (although Pachther might have nailed it when he said one of the company's biggest problems is that it's "in the fifth year of the three-year turnaround") but given the state of EA's stock, which during Riccitiello's tenure has tumbled from over $60 to its current price of $11.23, I'd love to know what would qualify as a bad job. Shooting some interns, maybe? In any event, this isn't the first time analysts have predicted doom and gloom [http://www.escapistmagazine.com/news/view/97434-Electronic-Arts-CEO-Facing-Trouble] for the chief: in early 2010, analysts said that EA's ongoing underperformance had left the management team with "zero credibility" and that Riccitiello wouldn't be given another year at the helm to turn things around.

Source: Develop [http://www.develop-online.net/news/41531/Riccitiello-to-remain-as-EA-CEO]

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[itsthesheppy]

Who would have guessed that being voted the worst company in America would be bad for your stock prices?

In addition to that, whoever thought that buying up studios and destroying them, pumping out bland samey games, looking for spectacle over quality, and completely losing touch with the player base would be bad for business?

This must be why I'm not a CEO. I just don't get economics.

 

[Falterfire]

They ARE still making all of the money, right? I mean, I'm not an expert at economics, but does it really matter what your stock prices look like if you still make money hand over fist?

Also: I don't think anybody NOT being fired really qualifies as news.

 

[Cowabungaa]

"I had lunch with John Riccitiello last week. He was asking me why no one wants to buy his stock," Pachter claimed [http://www.develop-online.net/news/41363/Pachter-EAs-Riccitiello-fears-for-his-job]. "He doesn't understand what's going wrong."

And yet in an interview he did last week he said that he thinks investors just don't get videogaming. Sounds different from "I haven't got a clue." And I'm inclined to agree. It's why I greatly dislike gaming companies going public. People who actually have nothing to do with videogames will eventually direct the course of your business. That's just plain bad for a creative industry if you ask me.

"The board has a very high level of confidence in John and the management team," Probst said. "They have done a really good job of exceeding the operating plans in the last few years."

Just more proof that the people on those boards know jack-shit about the videogame medium. Privately owned companies ran by people who are actual gaming enthusiasts are the way to go. They understand the product and have a bigger chance of understanding the audience.

They ARE still making all of the money, right? I mean, I'm not an expert at economics, but does it really matter what your stock prices look like if you still make money hand over fist?

Not enough, apparently. Owning a stock basically means owning a tiny bit of a business. So if your stocks are worthless that means that, basically, your business is worthless. Or that's what I can remember from my Economics class. I hated Economics though so take it as you will.

Also, if I remember correctly, yes EA is making plenty of money but they're also spending fucktons of money. Remember what they said about Dead Space 3; it has to sell 5 million copies to stay profitable. Says something about the insanely bloated production costs of that game. Lots of it marketing, I think.

 

[Fappy]

They ARE still making all of the money, right? I mean, I'm not an expert at economics, but does it really matter what your stock prices look like if you still make money hand over fist?

Also: I don't think anybody NOT being fired really qualifies as news.

To be fair this is technically just an update on a developing story.

 

[Rainboq]

Believe it or not, John seems to be very competent, his board of directors and investors, on the other hand, have no f*cking idea what they're doing. John's hands are tied, because he is at the behest of the shareholders, if they think its a good idea, he HAS to do it.

 

[Vivi22]

Believe it or not, John seems to be very competent, his board of directors and investors, on the other hand, have no f*cking idea what they're doing. John's hands are tied, because he is at the behest of the shareholders, if they think its a good idea, he HAS to do it.

What? Does EA have some singular majority shareholder I don't know about taking an active role in managing the company? Because it's pretty unusual for shareholders of a public company to have any role in managing it beyond voting for the board who act on their behalf. And even then, it'd be pretty rare for a board to take such an active role in a company as to tell the CEO what they should be making, especially in a creative industry like gaming when the board, or at least some of the members, might literally have no experience with the industry.

Point being, I'm betting he doesn't have shareholders telling him how to manage the day to day business, or which games to green light.

 

[Danceofmasks]

Oh this is a good one.
What do you mean you can't figure out why no one wants to buy your stock?

YOU ARE FUCKING EA.

 

[NinjaDeathSlap]

Business speak: "We have full confidence..."

People speak: "We give him another two weeks..."

 

[RC1138]

Leave him as CEO. I see nothing wrong with that. He clearly has a subconscious urge to make people dislike EA as much as possible and anything, or anyone, that furthers that is doing their job as far as I'm concerned.

 

[Azuaron]

"They have done a really good job of exceeding the operating plans in the last few years."

They need so better operating plans if they've been exceeding them the last few years...

I mean, really, is their operating plan, "Do not go bankrupt?" Hell, I could do that: Fire everyone, sell enough to pay off all liabilities, license all properties that remain, collect royalties.

NOT BANKRUPT.

(What do you mean this is why I'm not CEO? I see CEOs do that all the time!)

 

[gentlemanghost]

Electronic Arts continues to have a "very high level of confidence" in its management team.

I'm sure by "high level of confidence," you meant "high level of crap." Or maybe you were just high

 

[80Maxwell08]

Believe it or not, John seems to be very competent, his board of directors and investors, on the other hand, have no f*cking idea what they're doing. John's hands are tied, because he is at the behest of the shareholders, if they think its a good idea, he HAS to do it.

What? Does EA have some singular majority shareholder I don't know about taking an active role in managing the company? Because it's pretty unusual for shareholders of a public company to have any role in managing it beyond voting for the board who act on their behalf. And even then, it'd be pretty rare for a board to take such an active role in a company as to tell the CEO what they should be making, especially in a creative industry like gaming when the board, or at least some of the members, might literally have no experience with the industry.

Point being, I'm betting he doesn't have shareholders telling him how to manage the day to day business, or which games to green light.

Funny you should mention that. Remember a few years back when John said things like we need new IPs on the market and started green lighting a bunch of games? Along with otuer statements like game prices are too high and the like? Well guess how the shareholders reacted to someone who was actually being competent at the time? They told him to knock it off or they would fire him. So technically they don't decide what games do but they can decide to fire the guy green lighting them.

 

[Valok]

Ahhhh.. News about EA going down. I could watch these the hole day.

 

[mysecondlife]

I guess stockholders who know nothing about videogames would jump shit immediately. I haven't heard any good news regarding videogame industries as of late.

Also: I don't think anybody NOT being fired really qualifies as news.

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