Now here's some breaking news that'll no doubt make a lot of people's Mondays. John Riccitiello, Electronic Arts CEO since 2007, will be stepping down from his position and as a member of EA's Board of Directors by March 30.
Replacing Riccitiello as chief executive officer will be Larry Probst, "to ensure a smooth transition" and lead the executive team while the publishing giant searches for a permanent replacement. EA has stated that both internal and external candidates are being considered at the moment.
We'll keep you updated as we learn more on the situation. In the meantime, here's a quote by Riccitiello when he first took the CEO position roughly six years ago:
"Our game quality was down, and our costs were high. I could see a fundamental digital transformation coming to our industry that we were not even prepared for. The hardest part was that we were in deep denial."
Update: Riccitiello's resignation letter to the board was also released, in which he mentions several EA titles released over the last few years that he's particularly proud of. The letter also warns of lower-than-anticipated earnings for the fourth quarter, which EA will announce come May 7.
March 17, 2013
Mr. Larry Probst
Chairman Electronic Arts
I hereby offer my resignation as CEO of Electronic Arts effective with the end of our Fiscal Year 13 on March 30, 2013.
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.
I have been at the helm as EA's CEO for six years and served as COO for nearly seven years starting in 1997. I know this company well, and I care deeply about its future success. I leave knowing EA is a great company, with an enormously talented group of leaders and the strongest slate of games in the industry. I could not be more proud of our company's games, from Battlefield and FIFA, to The Simpsons: Tapped Out and Real Racing 3. We have built many great franchises that will serve the company well in FY14 and beyond. In particular, I am confident that the investments we have made in games for next-generation consoles will put EA in a strong leadership position for many years ahead.
In offering my resignation, my goal is to allow the talented leaders at EA a clean start on FY14. I look forward to working with you in the coming weeks on an effective leadership transition. I'm extremely honored to have led this company and proud to have worked with all the great people at Electronic Arts.
Probst, Riccitiello's temporary replacement, served as EA's CEO from 1991 through 2007, and has served as Chairman of the Board since 1995. As for Riccitiello, he joined EA back in 1997 as president and COO, then left in 2004 to become a founding partner and managing director of Elevation Partners, as well as chairman and CEO of VG Holdings, the company responsible for BioWare and Pandemic. In 2007, he returned to EA as CEO.
In another statement, he said:
"EA is an outstanding company with creative and talented employees, and it has been an honor to serve as the Company's CEO. I am proud of what we have accomplished together, and after six years I feel it is the right time for me pass the baton and let new leadership take the Company into its next phase of innovation and growth. I remain very optimistic about EA's future — there is a world class team driving the Company's transition to the next generation of game consoles."
As part of his resignation, Riccitiello will receive 24 months of salary continuiation and stock benefits until November 30, with his tock options exercisable until February 28.
While Riccitiello was able to drive digital revenue during his reign, through brands like FIFA and Battlefield, he also saw the failed NBA simulation and the ill-received Medal of Honor: Warfighter, not to mention Star Wars: The Old Republic, an endeavor that cost roughly $200 million for the studios involved.