News Post

EA CEO John Riccitiello Resigns

04:51 PM - March 18, 2013 by RaychelSnr

We're learning this afternoon that Electronic Arts CEO John Riccitiello is stepping down from his position at Electronic Arts effective March 30. Publisher of Madden NFL Football, FIFA Soccer, NHL and several other sports titles, Electronic Arts is one of the biggest sports gaming companies on the planet and this could have definite impacts on our genre's future.

The company is tapping former CEO and current Chairman of the Board Larry Probst to oversee the transition to a new permanent CEO.

"We thank John for his contributions to EA since he was appointed CEO in 2007, especially the passion, dedication and energy he brought to the company every single day," Probst said in a press release issued this afternoon. "John has worked hard to lead the company through challenging transitions in our industry, and was instrumental in driving our very significant growth in digital revenues. We appreciate John's leadership and the many important strategic initiatives he has driven for the company. We have mutually agreed that this is the right time for a leadership transition."

The reasoning for the resignation appears to be that EA is expecting to fall well short of revenue guidelines.

In a letter to Probst, Riccitiello said, "This is a tough decision, but it all comes down to accountability. The progress EA has made on transitioning to digital games and services is something I'm extremely proud of. However, it currently looks like we will come in at the low end of, or slightly below, the financial guidance we issued in January, and we have fallen short of the internal operating plan we set one year ago. EA's shareholders and employees expect better and I am accountable for the miss."

This transition in leadership comes at a time when EA is gearing up to take on a new generation of consoles amidst an expanding digital goods business, of which Riccitiello was a key driver and proponent of. EA's stock is up over 2.5% in after hours trading on the news.

Until we know of a replacement, we won't have an adequate idea as to what this means for EA's sports game lineup, if anything. We will update this story with additional details as they come available.

What do you think this means for EA Sports' future?

Member Comments

# 21 Gotmadskillzson @ 03/19/13 12:46 AM

Quote:

Originally Posted by Valdarez


	Make way for Peter Moore.

If Peter Moore get promoted to CEO, I will so laugh. His statements would have came true. I remember years ago when he was the head of Sega he once said he will be in charge one way or the other, of all the other gaming companies out there, even of his then rival EA.

Sure enough he worked for Microsoft, then became president of EA Sports and now is currently EA's COO. So more then likely he will be the next CEO.

# 22 Cubfan @ 03/19/13 04:02 AM

Quote:

Originally Posted by Gotmadskillzson


	People forget, it simply isn't just Sim City, but also the failure of the relaunch of the Medal of Honor series, the failure of what happened to the NBA Live series, the failure of Diablo 3, the failure of EA MMA, the mess they turned the Dragon Age series into, the mess the Fight Night series turned into. So yeah....those things add up.

The failure of Diablo 3?! The game sold millions of copies and is the reason online DRM will continue on. It was also not made or published by EA. Lets see if anything changes with Mr Riccitiello stepping down.

# 23 pietasterp @ 03/19/13 10:36 AM

The thing is, we look at this stuff as consumers/gamers, and we hope that EA makes moves towards becoming a company that makes great games again because that's what we (justifiably) care about. And I agree that if they do that, it could be a path back to profitability.

The problem is, from the perspective of the only people that EA really cares about - the shareholders - EA might as well be selling CD's (dating myself), boxes of candy, cardboard boxes, or whatever widget commodity you want to imagine. It's a natural business cycle; when a company gets really big, they get homogenized and whatever else they used to do or be, they just become "Big Corporation X" at a certain scale. They begin to care about doing business, not about doing whatever it was that got them to that position in the first place. And once they are publicly traded, they care only about the shareholders, who don't care about good games - they care about a profitable business model. If EA management had any reason to believe they could get their share price back up by releasing nothing but 99-cent or freemium mobile games that are essentially bite-sized 3-4 minutes experiences - say Angry Birds or some such -they would transition the whole company to that model ASAP. And they may actually have some reason to believe that may work, so look out...

Re: the NFL license, I suspect that's still a net money-maker for them, so it wouldn't make sense for them to ditch that license (depending on how future negotiations go). Although I really have no idea if that's true or not, so probably take that with a grain of salt.

# 24 speels @ 03/19/13 11:23 AM

Yea, I really don't feel that this will lead to EA dropping the NFL exclusive license. If anything, I can see them trying to re-up it for even longer. Right now there is NO competition in one of the biggest video game markets, NFL football, so why would they want to allow another developer to come in and take away market share. Of course this would be good for the consumer because it forces EA to up their game and make a better product or lose more market share. Why would EA want this as it would force the Madden series to cost even more because you would have to bring in even more developers, artists, etc to keep up. It's not like Madden can't improve, it just hasn't.

What I am really hoping for is that the new CEO actually starts cutting highly paid executives that are basically useless. It always happens in companies that become very successful. The top gets over valued, and when they need to cut costs, it's the people that work under them that take the hit. Of course in video games those are the really important people because they make the games better and still love their jobs.

I mean if I have and exec that makes $250,000 and it costs me $40,000 per video game maker, why would I not cut the exec and hire 6 new video game designers. It makes sense to everybody that the new designers would bring more to the table than the 1 exec, but until a business completely changes the way they think, this never happens.

I guess I will just have to wait and see what changes get made before I choose if this was good or bad.

# 25 pietasterp @ 03/19/13 11:29 AM

Quote:

Originally Posted by speels


	I mean if I have and exec that makes $250,000 and it costs me $40,000 per video game maker, why would I not cut the exec and hire 6 new video game designers. It makes sense to everybody that the new designers would bring more to the table than the 1 exec, but until a business completely changes the way they think, this never happens.

I'm pretty sure the execs make a might bit more than 250k....but I generally agree with your post. The problem is re-structuring has to be done intelligently - anyone can come in and whack 15% off the top/bottom, but doing it in a way that makes sense and helps improve the company is the key. I feel like this is becoming the Wall Street Journal comments section now, but unfortunately, that's what gaming discussions have come to in 2013....(sad face)

# 26 wisdom less13 @ 03/19/13 11:38 AM

Who cares? They're still going to push out games for coin. They get kudos of Battlefield running strong for a while now, but the memory that game takes up is crazy. The sport games are getting a bit stale to me. I recently bought NHL 13, and I'm mostly a franchise guy, but have played EASHL exclusively. There's something not right. I can't figure it out what it is, though. Back on subject...Eff this guy.

# 27 playball11 @ 03/19/13 02:31 PM

MVP! MVP! MVP!

# 28 zanner @ 03/19/13 03:41 PM

Fifa is the last EA Sports Title I buy, and that will stop after this year seeing how they stole $19.99 from me by taking the money from my PSN wallet yet not giving me the purchased points. So after 3 months, and countless tickets that kept getting opened up because of the horrible customer service options, they finally replied to one and said that the case was closed . So it's quite amazing that even though they're stealing money that they still fall short of revenue goals.

Which is quite frankly the reason they are ultimately going to fail with the current business model. The guys who built this company from the ground up in the days of Road Rash, Madden, Bill Walsh, and Mutant League are guys that are now settling down and have families. That ultimately, any time to play a video game is very precious time not to be wasted on senseless bugs that are still present for the past five years. And ultimately, should a problem arise, would like to receive some customer support instead of getting a reach around every time you have to Email or initiate a customer service chat with Sanjeev, Pradesh, Kalpesh, etc. who ultimately repeat the same canned lines and promise you that things will be resolved that they've just had "technical issues and your case was lost" and that "it will be escalated to the expert technical team"

Basically, EA will fail because they'll ignore one of the most important things in the industry and that's a good product with good service. Because the guys that built the company aren't ones to keep playing the games and being **** on by EA. At the same time, that'll funnel over into what games they buy for their kids and which games/game companies they won't. They really need to get their head out of their *** and stop resting on their laurels and get back to the basics of producing quality product like they once did when the company was just getting started and growing.

# 29 tfctillidie @ 03/19/13 05:46 PM

Quote:

Originally Posted by Vechi8


	Pietasterp is dead on. I am a finacial advisor and analyze corporations daily. While the microeconomics of EA is very important to a company's success, it is the macro outlook that keeps a CEO employed. Meaning, what is the bottom line. Stock price and earnings are what shareholders demand. When you look at their company's past quarters, very hard to recommend owning shares.

The large reason that drop is such a high percentage is the financial recession. Glad I don't take your analysis for my own finances considering that massive oversight in your response.

# 30 Crimsontide27 @ 03/19/13 06:45 PM

Would love to hear your financial insight as to why thousands of other companies listed under the NASDAQ didnt see an 83%+ drop in stock prices if it was due to only a recession.

EAs massive drop had a lot more to do with them throwing almost a billion dollars into the toilet with some very bad decisions that were made, some bad purchases and acquisitions they bought, the closure of multiple studios,and AAA games that sold millions but still werent very profitable due to mismangement of funds and resources.

There isnt a single action that you can pinpoint that led EA to where it is today, but blaming a financial recession on the reason that EA dropped 83%+ during JRs time at the helm is ludicrous.

# 31 pietasterp @ 03/19/13 07:19 PM

Quote:

Originally Posted by tfctillidie


	The large reason that drop is such a high percentage is the financial recession. Glad I don't take your analysis for my own finances considering that massive oversight in your response.

Nasdaq hit a 12-year high earlier this month. Most well-run companies have recovered (and then some) from 2008. I'm not saying this is all Riccitiello's fault - no one person is to blame for the woes of huge companies like EA - but when a company's market cap goes from $17B to $6.5B during your watch, which has lasted 7 years, you are on borrowed time.

All '08 did (in the long run) was thin the herd of the ailing...

# 32 Perfect Zero @ 03/19/13 07:39 PM

The best companies will survive any recession; it's the strong leaders that help a company's stability when the times are tough and then goes for gold when things are better. The fact of the matter is that Riccitiello couldn't keep EA above water and he did a terrible job with the company.

What I would expect is that EA's next CEO is going to want to continue into the micro transactions since it's the big thing on the street (why Wall Street doesn't cut all that off with Zynga and Facebook struggling I'll never know). I would also expect that EA would want to keep the exclusive license with the NFL simply because it's brand recognition and it's something to tout to investors.

In other words, the status quo.

# 33 tfctillidie @ 03/19/13 07:55 PM

Quote:

Originally Posted by pietasterp


	Nasdaq hit a 12-year high earlier this month. Most well-run companies have recovered (and then some) from 2008. I'm not saying this is all Riccitiello's fault - no one person is to blame for the woes of huge companies like EA - but when a company's market cap goes from $17B to $6.5B during your watch, which has lasted 7 years, you are on borrowed time. All '08 did (in the long run) was thin the herd of the ailing...

My point simply boils down to that the large drop wasn't really an EA problem, it was bigger. The real problem is that EA hasn't bounced back like companies have done, which would have been the very simple analysis to make. I have a pet peeve vs the one who declares "I'm an expert so and so" who proceeds to blow smoke.

Anyways.

I fear for the future though. Under JR the quality of the games did improve. Say what you will about Madden, I'm very frustrated with it myself, you still cannot deny the quality improvement. However, that hasn't translated into $$$ for the company.

What's the next CEO to do if improved quality didn't get the job done?

I really just feel he missed the mark on the quality we want (in sports gaming), perhaps Moore is to blame for this more than anyone.

In 2013 I still don't understand why they aren't selling me a $50 title then giving me proper DLC like
-More graphic packages
-Additional commentary teams
-Old stadiums
-Etc

If you make these facets of the proper quality, they would be worth the price tag. Hell even scale back the major game and remove a bit, sell it for less and let gamers buy the add-ons. Could you come out ahead in that scenario? I certainly wonder.

Even with a title like FIFA it blows my mind it isn't a persistent title that's simply updated. Pay $40 to get the new "engine" every year. Buy the stadium pack for MLS for $20, buy the player face pack for Division 5 football in Ukraine....you get my point.

They never really captured the exact content to sell as DLC when it comes to sports titles. Selling "attributes" that come without explanation is pure malarkey.

# 34 DmosleyBoy @ 03/19/13 08:11 PM

Im so happy to here this. Im hoping that the lawsuit led by Ed O'Bannon and his people will be enough of a destraction to allow the company that owns 2K sports to jump in and get the NCAA liscenses from the CLC so we can have college basketball again and to also get a GOOD college football game again! I absolutely despise EA, they create games and dont focus on the teams, just all this stupid crap noone cares about. They left off 50 something teams of their college basketball game, hell ncaa football 2013 is missing South Alabama for cryin out loud!!!!!!!!!!!! AND THEIR EXCUSE FOR IT WAS LAUGHABLE!!!! People buy these games to take their crappy little school that sucks every year IRL so that they can sorta live the dream of their school being the next Butler, VCU, Gearge Mason, or Gonzaga and so forth. Sorry for the venting.

# 35 Phreezy P @ 03/19/13 10:57 PM

Quote:

Originally Posted by DmosleyBoy


	Im so happy to here this. Im hoping that the lawsuit led by Ed O'Bannon and his people will be enough of a destraction to allow the company that owns 2K sports to jump in and get the NCAA liscenses from the CLC so we can have college basketball again and to also get a GOOD college football game again! I absolutely despise EA, they create games and dont focus on the teams, just all this stupid crap noone cares about. They left off 50 something teams of their college basketball game, hell ncaa football 2013 is missing South Alabama for cryin out loud!!!!!!!!!!!! AND THEIR EXCUSE FOR IT WAS LAUGHABLE!!!! People buy these games to take their crappy little school that sucks every year IRL so that they can sorta live the dream of their school being the next Butler, VCU, Gearge Mason, or Gonzaga and so forth. Sorry for the venting.

They don't have the NCAA rights anymore. Anyone can take it, it just doesn't generate enough profit and the license just isn't worth it.

# 36 ubernoob @ 03/19/13 11:19 PM

Quote:

Originally Posted by airaron32


	They don't have the NCAA rights anymore. Anyone can take it, it just doesn't generate enough profit and the license just isn't worth it.

NCAA by EA has always been the best college football game. 2ks offerings were horrendous.

Anyways, the lawsuit against EA just means that EA can't get the exclusive license for 5 years, not that they can't have the NCAA license.

Looking for any good new sports games to come out now though us nothing more than a pipe dream sadly. Maybe next gen we will get some competition but even then I'm not holding my breath.

# 37 ItsOrangeBaby @ 03/20/13 04:38 AM

Knew the press sim city was getting was bad, but did not think it would push the ceo to resigned. I guess going back to 07 he had his fair share of success and flops. Guessing when it comes to sports gaming other then the status of the live series I'm guessing this might give a chance to a new college basketball game.

# 38 ubernoob @ 03/20/13 08:19 AM

Quote:

Originally Posted by OhioBuckeyes7


	NCAA is EA best football game and the law suite is stupid with in it's self. the players are not even the real life counter part in the game.it's just made up stats with real names us fans put on the back of the jersey. nothing is in violation of that.

Um, yes the counterparts ARE them in the game. They play like them and everything. To say otherwise is just silly.

# 39 pietasterp @ 03/20/13 09:25 AM

Quote:

Originally Posted by ubernoob


	NCAA by EA has always been the best college football game. 2ks offerings were horrendous.

I disagree; I really enjoyed 2k's college football games, and the game I spent the most time with (maybe ever?) was NCAA college football 2k2. I must have played through 20 seasons of that game. It didn't have all the bells and whistles of EA's offerings, but it was the 2k football engine with college teams. More than enough for me.

Quote:

Originally Posted by ItsOrangeBaby


	Knew the press sim city was getting was bad, but did not think it would push the ceo to resigned.

It didn't...it's not about the games. Hasn't been for some time with EA.

# 40 howboutdat @ 03/22/13 08:45 AM

Quote:

Originally Posted by mauro78


	Nobody knows....let's just hope it won't be renewed....

dont hold on breathe on this .... we can all dream of getting 2kfootball back , since the espn2k5 was a better game than the current madden. But i highly doubt they will not want to renew that conract. The NFL sought EA out to give them the contract to start with.Also EA knows , as long as they have that contract, while it may cost them intitially upfront cost, they will not have any competition and can do alot of copy n paste maddens for a while .They also know ,without any competition, anyone who wants to play an nfl video game, MUST go thru them . That will well make up for the cost of the contract for many years worth of maddens.Its really sad that the NFL wont listen to the gamers and stop renewing with EA. You can bet, new ceo will have it renewed, and next madden will be a copy n paste of this one , with a few minor irrelevant (real refs , what a joke) add ons that wont deal with the crappy servers, or the gameplay . We must face facts, until we stop buying Madden, this is what we will keep getting.

« Previous 123 Next »

More Links

EA CEO John Riccitiello Resigns