The extravagant spending of the industry giant EA has raised an eyebrow amongst the business geniuses. The former CEO, John Reccitiello resigned after accepting his culpability for the failure to meet the financial targets of the company in the last quarter. The post is currently held by Larry Probst, a chairman of the board since 1994 and the Last CEO of the company before Reccitiello. He has taken up the post as an interim chief executive until a perfect legatee is found.
The main reason that has got people to speculate about it is the pay package of Probst. He has taken the responsibility for a compensation of whopping $1.03 million a year. Depending on his performance there are also promises of great additions to his package at the end of the year. On the other hand, according to the reports of The WSJ, the total severance package of Riccitiello will cost $4.7 million for the company. This high financial overhead of a company that has failed to meet it’s financial targets.
In this context, Probst mentioned in his speech at the occasion of resignation of Reccitiello that the strategy the company follows is flawless and the future is full proof. The resignation was a mutual decision of transition in leadership for greater development of the company. He also added that, in his 12 years of service, Reccitiello has introduced a whole new era of strategic initiatives to drive the company successfully on it’s growth path.
The fourth quarter and the fiscal year 2013 results of EA will come in public light on the date of May, the 7th. As a market response to the resignation of Recetillo, the stock of the publisher has jumped 2.6% up within a few hours of trading. The analyst Colin Sebastian has assured the investors that the shuffle in the position is justified and makes perfect sense for the growth of the company. The industry analyst suggested the names of Frank Gibeau and COO Peter Moore as potential substitutions.
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