EA CEO John Riccitiello is stepping down

[o.pwuaioc]

Wow...that is abysmal. With that sort of performance, it is amazing that he wasn't fired years ago.

You can't blame him for Late 2008, the market crashed, all stocks plummeted down during that period. You can blame him for not being able to recover the company afterwards though.

The profit charts posted by Ack is terrible. No company can talk about profitability and trends without looking at a much longer time period and other charts of competitors. If only EA were to crash or many other game companies saw similar trends, then he's in the clear.

[Ack]

The profit charts posted by Ack is terrible. No company can talk about profitability and trends without looking at a much longer time period and other charts of competitors. If only EA were to crash or many other game companies saw similar trends, then he's in the clear.

Actually this has been a general trend in game companies' stock values for the last few years. I compared this one to typical performance from the last five years for Take Two, Ubisoft, Capcom, and Activision, and they all have a similar trend.

[MrPopo]

The profit charts posted by Ack is terrible. No company can talk about profitability and trends without looking at a much longer time period and other charts of competitors. If only EA were to crash or many other game companies saw similar trends, then he's in the clear.

Actually this has been a general trend in game companies' stock values for the last few years. I compared this one to typical performance from the last five years for Take Two, Ubisoft, Capcom, and Activision, and they all have a similar trend.

That's also not a profit chart. You can do baller profits and still have a shitty stock price if the market hates you.

[Ack]

That's also not a profit chart. You can do baller profits and still have a shitty stock price if the market hates you.

Truth, as a lot of it has to do with investor confidence. If you're turning a great profit but spooking everyone through your business tactics, your investors may worry about your future to the point that they leave or demand change.

As for the chart, I pulled it from the link I posted on the first page in response to Luke's question about how well EA is doing. We got into discussions about profitability of its various properties afterward.

[MrPopo]

That's also not a profit chart. You can do baller profits and still have a shitty stock price if the market hates you.

Truth, as a lot of it has to do with investor confidence. If you're turning a great profit but spooking everyone through your business tactics, your investors may worry about your future to the point that they leave or demand change.

For the first few years I worked at Amazon we had this exact problem. The quarterly report would come out and we'd consistently have the best profits ever, but there'd be one thing that the investors would latch on to as "oh no, this isn't perfect, Amazon will go away soon" and the stock price stayed pretty low. Then we finally had a quarter in 2010 that just went insane, and our price jumped up 40 points, and then rose another 100 points over the next year and a half.

[o.pwuaioc]

The profit charts posted by Ack is terrible. No company can talk about profitability and trends without looking at a much longer time period and other charts of competitors. If only EA were to crash or many other game companies saw similar trends, then he's in the clear.

Actually this has been a general trend in game companies' stock values for the last few years. I compared this one to typical performance from the last five years for Take Two, Ubisoft, Capcom, and Activision, and they all have a similar trend.

Re MrPopo: Of course, I was posting too hasty and my fingers confused things. Likewise, I didn't mean to suggest that Ack did anything wrong, but rather taking that as a the reason for the CEO's firing - as if the CEO was screwing up the company - is wrong.

Ack: Bingo. I have no love for EA, but comments about how it's the CEO's fault because of investor confidence - or profitability - are misled.

Edit: I should stop typing while my mind is occupied with other matters.

[Ack]

Sure, but typically a continued lack of investor confidence will result in layoffs of executive staff. After so many years, with debacles like what is happening with SimCity right now, I'm not surprised this occurred. If anything, EA's board is probably using it as a means to placate those investors who are worried about the company's performance.

Do I blame Riccitiello for his company's performance? No, though I have severe misgivings about some of the practices he pursued, such as microtransactions. But as I said in my first post, his tenure has been a mixed bag at EA, and there are some things we ought to consider praising him for. Above all, I'm not an EA investor, so I'm more interested in seeing how this will effect their game production as opposed to their stock value and business future.

[o.pwuaioc]

Sure, but typically a continued lack of investor confidence will result in layoffs of executive staff. After so many years, with debacles like what is happening with SimCity right now, I'm not surprised this occurred. If anything, EA's board is probably using it as a means to placate those investors who are worried about the company's performance.

Do I blame Riccitiello for his company's performance? No, though I have severe misgivings about some of the practices he pursued, such as microtransactions. But as I said in my first post, his tenure has been a mixed bag at EA, and there are some things we ought to consider praising him for. Above all, I'm not an EA investor, so I'm more interested in seeing how this will effect their game production as opposed to their stock value and business future.

Yep, agree 100%. Sorry, I'm referring specifically to bringing out the chart without some context. Need more years, need more comparanda.

[MrPopo]

Sure, but typically a continued lack of investor confidence will result in layoffs of executive staff. After so many years, with debacles like what is happening with SimCity right now, I'm not surprised this occurred. If anything, EA's board is probably using it as a means to placate those investors who are worried about the company's performance.

Do I blame Riccitiello for his company's performance? No, though I have severe misgivings about some of the practices he pursued, such as microtransactions. But as I said in my first post, his tenure has been a mixed bag at EA, and there are some things we ought to consider praising him for. Above all, I'm not an EA investor, so I'm more interested in seeing how this will effect their game production as opposed to their stock value and business future.

From the consumer side, it feels like the bad stuff EA has done has been REALLY bad, while the good stuff hasn't been earthshattering; it's the expected competence level of a well-established company.

[prfsnl_gmr]

I think that comparing EA to Activision over the last 12 months is useful. Activision's stock price is almost back to pre-crash levels, and EA's stock price hit an all-time low.

Certainly not all of that is the CEO's fault, but - from the comments at least - it seems like EA needs to head in a very different direction.