EA Chief John Riccitiello Still Isn't Fired

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EA Chief John Riccitiello Still Isn't Fired

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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. "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 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

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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.

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.

Andy Chalk:
"I had lunch with John Riccitiello last week. He was asking me why no one wants to buy his stock," Pachter claimed. "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.

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?

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.

Andy Chalk:
In any event, this isn't the first time analysts have predicted doom and gloom for the chief: in early 2010, analysts said that EA's ongoing underperformance had left the management team with "zero credibility" and said that Pachter wouldn't be given another year at the helm to turn things around.

Wait wait wait... Pachter wouldn't be given another year if he couldn't turn things around?! Is Pachter secretly the management team?!

Things have gotten rather... interesting now. No wonder he is against Nintendo! Does that even make sense?! I DON'T KNOW ANYMORE!

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.

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

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.

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.

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.

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.

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

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

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.

Andy Chalk:
"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!)

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.

Well actually they are not really making money hand over fist. The 2012 fiscal year was the first in five years where they actually had a profit. They had a massive loss back in 2008 but every year after they have had smaller and smaller losses culminating in a profit in 2012. The reason their share price has been going down is because when a company posts a year end loss they are not allowed to pay out dividends meaning shareholders got nothing those years. The nice thing about loses and corporations is that you can carry them back X number of years to get back the tax you paid on profits in prior years.

Logically now that they are making profits their share price should start to go back up. One issue however is that they are speculating a small loss again for the next couple years due to increased costs caused by a new console generation.

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

Didn't he sell his own shares a short while ago?

Vivi22:

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.

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.

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

80Maxwell08:

Vivi22:

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.

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.

Pretty interesting viewpoint. What exactly gives you such insight on to such things? Or did you just come to this conclusion logically?

In the world of the Rich white man, nothing is really your fault.
Welcome to Mitt Romney's America.

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.

Falterfire:

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

Welcome to Escapist

1: Buy a semi-popular developer with a cool new idea!
2: Churn out a bland sequel!
3: Churn out a WORSE game with shitty DLC, shitty MP, and that is a bland COD rip off.
4: Watch series crash, shrug and repeat.

See what happens Mr Riccitiello? Its not that hard.
You ugly piece of greedy corporate filth.

Devoneaux:

80Maxwell08:

Vivi22:

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.

Pretty interesting viewpoint. What exactly gives you such insight on to such things? Or did you just come to this conclusion logically?

I remember these being news stories a long time ago but sadly I don't have links. I know the terminology is a vote of no confidence where the shareholders decide if the current CEO is doing his job right and choose whether to get rid of him or not. I know after that point we started getting way more money grubbing from them with stuff like the infamous statements of him talking about charging for ammo in shooters. Like Jim Sterling was saying a few years ago they used to be good then came that threat and it all started going downhill.

Noother note that you typoed patcher there at the end. You mean John R.

Well, if THQ's stock decline wasn't considered a problem to their board, I don't see why this would worry EA's.

Of course it is not Riticello's fault EA's stock prices are dropping. Everyone knows stock values are not related to a company's actual performance in any way, shape or form and at best are related to an imaginary version of the company existing in a Socratian/Jungian realm of pure thought. My business advice to Riticello is to attempt to become a being of pure thought and take it from there.

Also, all the people saying DUR DUR OF COURSE THE STOCKS ARE DROPPING WHO WANTS TO BUY EVIL EA are hilarious. You know the image of the greedy video game exec that only wants to make money and doesn't give a shit whether the games are actually good? Investors are ike that. I mean literally. They don't care what the company is doing as long as it makes them money and if they think it won't they'll sell it and buy Chick-a-fil-a instead in a heartbeat. Saying that investors don't want to buy EA because of its business practices is like saying Hitler never listened to his generals because no one trusts Nazis.

Of course it is not Riticello's fault EA's stock prices are dropping. Everyone knows stock values are not related to a company's actual performance in any way, shape or form and at best are related to an imaginary version of the company existing in a Socratian/Jungian realm of pure thought. My business advice to Riticello is to attempt to become a being of pure thought and take it from there.

Also, all the people saying DUR DUR OF COURSE THE STOCKS ARE DROPPING WHO WANTS TO BUY EVIL EA are hilarious. You know the image of the greedy video game exec that only wants to make money and doesn't give a shit whether the games are actually good? Investors are ike that. I mean literally. They don't care what the company is doing as long as it makes them money and if they think it won't they'll sell it and buy Chick-a-fil-a instead in a heartbeat. Saying that investors don't want to buy EA because of its business practices is like saying Hitler never listened to his generals because no one trusts Nazis.

I say leave him there. The longer he makes the company fist itself, the better everyone else will be.

I say, "stay the course EA, stay the course." I want to see capitalism work for once. ;)

Always nice to see some good news :)

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.

Go look at their financial statements. They have been loosing hundreds of millions of dollars a year(some times over a billion a year), this year was the first time in quite a few years that they actually made money($18 million before taxes, $76 million after taxes) and to do that they had to take out $539 million in debt. So essentially no they are not making money and they haven't been for quite some time.

CardinalPiggles:
I say leave him there. The longer he makes the company fist itself, the better everyone else will be.

When you mean "fist" did you mean this

image

SHOVED where the sun don't shine? I could have sworn that he' already using himself as a sock puppet for almost a year now...

Their recent unjust bashing of Steam and forcing people to conform to their Orgin "service" as if they WANTED it doesn't help matters either, investors no longer see EA as a immediate cash cow and would rather not wait to see if it will improve first because the stock could stagnate for years before it improves, cutting into their investment return

Stocks don't reflect the company's performance as some other posters have already pointed out, but EA have been making statements that brings doubt to investors by saying a the next Dead Space must sell so much in order to stay afloat implying their lack of confidence of the game selling well before the game is even completed for release and had to lay off prototype development employees due to "poor sales"...

If Battlefield 3 wasn't under EA it could have been a LOT worse for them

He will be soon. Then he will have to go work at Taco Bell cos no one else will want him, and EA will go back to just making sports games then everyone will be happy.

Andy Chalk:
given the state of EA's stock, which during Riccitiello's tenure has tumbled from over $60 to its current price of $11.23

Whoa, whoa, wait, what? He's been their CEO since 2007 and the stock has dropped by roughly $50? How the hell does he still have his job?

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.

I agree. If you take him out of being the CEO he'll go on to ruining some other company. Better to take one for the team and keep him on until the company crashes and burns.

I am amazed this man still has his job. But then, I'm amazed EA still does the shit it does, so I guess the two balance out?

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