It seems like just last week we were discussing all the heads of the major mobile players have left their respective companies lately. That's because it was last week. And now this week, we have yet another departure, and it's just as impactful. On March 30th, Electronic Arts CEO, John Riccitiello, will resign from his executive position with the company, as EA continues to bleed money and shift to a new focus.
On the reasons for the transition, Riccitiello 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... My decision to leave EA is really all about my accountability for the shortcomings in our financial results this year. It currently looks like we will come in at the low end of, or slightly below, the financial guidance we issued to the Street, and we have fallen short of the internal operating plan we set one year ago. And for that, I am 100 percent accountable.
So while it sounds a lot like the Groupon firing, his resignation could also have a lot to do with the SimCity disaster, the outlash from consumers over EA's massive support for micro transactions and DLC, or both. A lot has changed since Riccitiello took over in 2007 up to now, with major shifts to mobile gaming and a high consumer demand for non-broken games at launch.
At any rate, while Electronic Arts looks for a new CEO, former CEO, Larry Probst, will take over in the interim. Probst ran the game studio and publisher from 1991 to 2007. He also spoke on Riccitiello's stepping down, as well as give some insight into his plan moving forward until a new CEO is found.
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... EA's strategy and future are rock solid. Our business is built on more than a dozen powerful, globally recognized brands. We are clear leaders in the fastest growing category in games - mobile - and we are positioned to lead on the next generation of consoles.
A lot of people are upset with Probst back in the picture, claiming he sunk EA into a big mess during his tenure. However, with the EA's stock now at just under $20 when it was over $60 back in 2007 when Riccitiello took over, I'm not so sure I agree. Ever since the inception of the Xbox 360 and PS3, along with the new CEO at EA, we saw the studio take their foot off the pedal and refuse to innovate their products. We saw, and still see, broken sports titles, released year after year with merely a roster update, less than stellar performances in their racing games and a lackluster showing in the mobile division. All of that goes in line with the failed stock price and definitely justifies the resignation. To that point, I commend Riccitiello for stepping down and taking responsibility as leader of a large company like this. I look forward to seeing a new CEO step in and hopefully take EA back to its old glory days, when there was integrity and respect behind each product put into the consumer market. The next generation of consoles is right around the corner, and, so long as the lack of success and poor company culture hasn't consumed the developers yet, they should be ready to show the world what they can do.