Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }

Electronic Arts' Chief Executive Officer John Riccitiello poses during E3, the Electronic Entertainment Expo, in Los Angeles in this June 8, 2011 file photo. Riccitiello has resigned, saying he was "accountable" for the company's missing operational targets. Riccitiello will step down from his post as CEO and member of the board of directors on March 30, the video game company said on March 18, 2013.

PHIL McCARTEN/REUTERS

Electronic Arts' Chief Executive Officer John Riccitiello has resigned after six years at the helm of the video games publisher, saying he held himself accountable for missed operational targets.

The company behind the Sim City and Medal of Honor franchises on Monday warned investors that earnings in the current quarter will be at the low end of, or slightly below, its previously issued forecasts.

Riccitiello will step down from his post and leave the company's board on March 30, after having overseen a near-two-thirds loss in the company's market value since he became CEO in April 2007.

Story continues below advertisement

EA and rivals like Activision Blizzard Inc have seen growth fall off sharply as more gamers flock to free games on social networks or on mobile devices. The biggest traditional games publishers have tried to buy startups and invest in mobile platforms but face intense competition from entrenched players like Rovio or Zynga.

"We have fallen short of the internal operating plan we set one year ago," Riccitiello said in a resignation letter filed with the Securities and Exchange Commission. "EA's shareholders and employees expect better and I am accountable for the miss."

Under Riccitiello's watch, the company grew its digital and mobile games businesses. Analysts say the company's revenue from mobile games has been a bright spot in recent quarters.

But the company has had high-profile slip-ups in recent months. Its latest installment of the popular city-building game "SimCity" – released earlier this month – was marred by server glitches and angered gamers who could not access the game for days.

EA said it was unable to handle the user demand for its new title. The classic city-building game first came out in 1989 and became one of Electronic Arts' biggest hits. The new, $60 game was given a modern-day look and feel, and received positive reviews before its launch.

To win back the support of its users, the company issued an apology on Friday and said it would offer them a free downloadable PC game from its portfolio.

In January, Electronic Arts slashed its fiscal 2013 earnings forecast after a weaker-than-expected holiday quarter marked by disappointing sales of its Medal of Honor title. It also forecast non-GAAP revenue for the fourth quarter ending March 31 of about $1.025-billion to $1.125-billion.

Story continues below advertisement

EA's former CEO and chairman of the board, Larry Probst, has been appointed as executive chairman as the company begins its search for its next CEO, the company said.

The news of Riccitiello's exit did not come as a surprise, Mike Hickey, an analyst at National Alliance Capital Markets, said.

Whether it has been the company's performance guidance, the loss of key development talent or botched product launches, Riccitiello has had "a track record of mis-executions," Hickey said.

"The stock that has underperformed encapsulates all of the issues," Arvind Bhatia, an analyst at Sterne Agee said. "And this most recent quarter was the straw that broke the camel's back."

New game hardware could potentially boost sales in the troubled video game sector, according to analysts. Consumers are holding back from buying hardware and software as they wait for rumored next-generation versions of Sony Corp's PlayStation and Microsoft Corp's Xbox, expected later this year.

"We believe timing makes sense for a CEO transition at the end of the fiscal year, and ahead of next generation console launches and a strong second-half title lineup (Battlefield and EA Sports)," analyst Colin Sebastian of R.W. Baird said in a note.

Story continues below advertisement

Electronic Arts' stock climbed 3.4 per cent to $19.35 in after-hours trade, from a close of $18.71 on the Nasdaq.

Report an error
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies