Analysts on What Pushed EA's Riccitiello to Resignation

Star Wars and talent jumping ship.

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So EA CEO John Riccitiello has resigned - but what (or who) drove him to do it? According to a number of analysts it was sparked by more than just an attack of conscience, with pressure from the executive board mounting following a string of misses in social and mobile.

One big black spot on the CEO's record is Star Wars: The Old Republic, which has reportedly failed to impress the board with its post-launch struggles. Bioware suffering the loss of its two high profile leaders, Ray Muzyka and Greg Zeschuk, hasn't helped - and is just one instance where EA-owned studios have been leaking talent.

"If you read his resignation letter, it was clearly prompted by the board," Wedbush Morgan?s Michael Pachter told Eurogamer. "I think that missing guidance is a pretty weak excuse to fire him, particularly since the industry was down 24 per cent last year, and EA managed to gain share and grow its digital business.

"My guess is that the board couldn't get over the Star Wars disaster (one of the reasons for buying Pandemic/BioWare), and the departures of the doctors, the departures of all of the PlayFish guys, and lacklustre social and PopCap results just tipped them against him. The missed guidance was the straw that broke the camel's back."

Baird Equity Research analyst Colin Sebastian is a bit more optimistic, telling MCV that the move will help EA better prepare for the next generation. "Despite the company's challenges over the past six years, we believe EA is well positioned for the console refresh cycle, and the company has made progress in building a digital platform and more recently controlling expenses."
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Comments

Ergo 19 Mar 2013 16:51
1/1
The company is worth ONE-THIRD what it was 5-years ago, and analyst wunderkind Pachter thinks his removal was unreasonable?? It's not unreasonable, it's amazing the (clearly incompetent) board let Riccititiello stay in his job as long as he had.
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