Less than a month after game developers revolted against a new fee rollout, Unity Software Inc. said John Riccitiello will retire as president, chief executive and chairman of the game-engine and ad-monetization company he took public at the height of the COVID pandemic.
Unity appointed James Whitehurst as interim CEO; Roelof Botha, lead independent director of Unity’s board, has been appointed chairman. The board said it would initiate a search for a new CEO.
Recently, Unity drew fire from game developers and had to alter a fee rollout for its game engine.
On a recent Unity
U,
mea culpa on a YouTuber’s stream — the link to which was posted on Unity’s website, but not affiliated with the company — Unity executive Marc Whitten took full responsibility for the tone-deaf Sept. 12 rollout of a fee structure that would have charged videogame developers every time someone downloaded their game.
During the interview, Whitten was asked who had authorized the fee rollout, and a contrite Whitten reiterated that it had been his decision, and that he and his team had not listened as well as they could have to developers’ concerns before the rollout.
The stream followed an open letter from Whitten apologizing to the developer community on Sept. 22.
More than one Wall Street analyst had already started factoring the unpopular fees into estimates, despite one calling the Sept. 12 rollout a “PR disaster.” Unity, however, came back to the table after developers started switching off Unity’s game-monetization features in their games. Riccitiello has been known to be critical of game developers who don’t think about how they will monetize their games.
Riccitiello, who will leave the company altogether, “will continue to advise Unity to ensure a smooth transition,” Unity said. Unity shares declined as much as 2.5% after hours, following a 1.5% decline in the regular session to close at $29.70.
Read: New Unity fees are ‘critical to the foundation of the company,’ exec tells videogame developers
The company also reaffirmed its third-quarter outlook. Back in August, Unity forecast revenue of $540 million to $550 million, citing a flat game-ads market and a continued soft market in China.
Analysts surveyed by FactSet, at the time, had estimated revenue of $549 million, and now forecast $555 million.
Unity went public back in September 2020, opening at $75 after pricing at $52 a share.
At Monday’s close, Unity shares were up 3.9% year to date, while the S&P 500 index
SPX
is up 12.9%, and the tech-heavy Nasdaq Composite
COMP
is up 28.8%.
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