Electronic Arts continues to have a "very high level of confidence" in its management team.
Earlier this month, analyst Michael Pachter said that Electronic Arts CEO John Riccitiello was sweating a little over his long-term prospects at the company. EA's stock is in the tank, currently sitting at less than half of Take-Two's value when EA tried to take it over in 2008, and Riccitiello, according to Pachter, can't figure out why. "I had lunch with John Riccitiello last week. He was asking me why no one wants to buy his stock," Pachter claimed. "He doesn't understand what's going wrong."
But at today's meeting of EA shareholders, Chairman Larry Probst put the rumors of Riccitiello's imminent demise to rest. EA's board of directors monitors the management team and discusses long-term succession plans "on a regular systematic basis," he explained, and right now they're pretty happy with the job he's doing.
"The board has a very high level of confidence in John and the management team," Probst said. "They have done a really good job of exceeding the operating plans in the last few years."
I have no idea what that operating plan might be (although Pachther might have nailed it when he said one of the company's biggest problems is that it's "in the fifth year of the three-year turnaround") but given the state of EA's stock, which during Riccitiello's tenure has tumbled from over $60 to its current price of $11.23, I'd love to know what would qualify as a bad job. Shooting some interns, maybe? In any event, this isn't the first time analysts have predicted doom and gloom for the chief: in early 2010, analysts said that EA's ongoing underperformance had left the management team with "zero credibility" and that Riccitiello wouldn't be given another year at the helm to turn things around.