Times are tough, but not if you’re an industry chief executive.
CEOs from other industries in America have come under a lot of scrutiny, and it’s usually the ones getting government bailouts. We were inspired to see last month when General Electric [GE] boss Jeffrey Immelt forgo more than $23.7 million in bonus and incentive money, but not terribly surprised because his company made use of government support.
So how does Immelt’s outrage-saving move relate to game CEOs? While few CEOs reaped bonuses in their last fiscal year, stock options and incentives were awarded to key players making their total compensation about 12 notches above healthy. We couldn’t help but wonder if the money spent on bonuses/incentives could have gone toward saving a few jobs. At least game company CEOs weren’t flying corporate jets to Washington asking for billions in bailout money.
Below we outline the total compensation of CEOs of publicly traded US game companies, based on their proxy statements filed with the SEC. These companies use external compensation committees to decide pay based on a variety of factors including competitive executives’ pay, and individual and company financial objectives.
Activision CEO Bobby Kotick: $14.9 Million
Kotick is the recipient of the industry’s largest bonus last year, a cool $5 million on top of his base pay of $899,560. He also got $3 million in incentives.
As with most CEOs, the lion’s share of Kotick’s total compensation in 2008 was in his exercised stock options, which was $5.9 million.
Of note, Kotick’s total compensation the year before (before Activision’s acquisition of Vivendi) was a mere $2.8 million. We’re relieved he’ll be able to put dinner on the table this year.
Oh, and Activision’s 2008 bottom line? A loss of $107 million.
Electronic Arts CEO John Riccitiello: $5 Million
Riccitiello’s base pay was a modest $750,000 in EA’s last fiscal year ended March 31, 2008, but the longtime exec who returned to the company in 2007 was awarded $3.6 million in stock options. He was also paid $625,350 in incentives.
EA, in Q3 of its current fiscal year, posted a loss of $641 million in Q4 and expects a loss of between $3.29 and $3.56 per share for the year.
THQ CEO Brian Farrell: $2.7 million
Times are tough for THQ, so why shouldn’t they be a little tougher on their Chairman/CEO Farrell? Farrell’s 2008 take was $600,000 lower than what he made in 2007, so now he’ll have to settle for the BMW over the Bentley.
Although Farrell’s base pay was $651,087, the bulk of his total compensation came from $1.4 million in option awards.
THQ’s net loss in Q3 was $192 million and would not give guidance for Q4. However, Wall Street expects Farrell’s company to lose about 30 cents per share for the quarter.
GameStop CEO Dan DeMatteo: $4.9 million
Matteo is relatively new to the CEO club, taking the reigns from R. Richard Fontaine late last summer. Still, in the previous year as GameStop’s COO, DeMatteo was handsomely compensated.
The used game king of retail will report its year-end earnings in the middle of this month, but both Matteo and Fontaine are already reaping the benefits following an improved sales and profit guidance notice a few weeks ago: $2.4 million bonuses for each of them.
Now that stores like Toys R Us and Amazon.com [AMZN] are seeing the high-margin benefits of used game sales, they’ve entered the same arena as GameStop. Our question is, what will DeMatteo do to counter this? Perhaps GameStop will continue to do what it does, and wait for the others to fail.
Midway CEO Matt Booty: $387,584
Put an asterisk next to Booty’s name for this list: he wasn’t officially Midway’s CEO until late October last year, and the meager salary he made was as the company’s SVP of worldwide studios/interim CEO.
Booty’s former boss, former CEO David Zucker took in $1.5 million in total compensation.
The rest, as they say, is history. Midway is now facing the possibility of going out of business after filing for bankruptcy protection and selling the publishing rights for its next big game, Wheelman.
Majesco CEO Jesse Sutton: $943,847
Sutton, CEO of one of the few profitable American publishers had a base pay of $356,073 and a bonus that almost equaled that amount, thanks to his company riding the Cooking Mama wave on Nintendo’s systems.
Sutton’s company will keep the Mama momentum going this year with the release of Gardening Mama and will bring a favorite of older gamers (including this editor), A Boy and His Blob for Wii.
Our advice is for Sutton to not rest on his laurels: Majesco’s net income was a mere $3.4 million last year.
Take Two CEO Ben Feder: $1
No, Feder didn’t just make $1 last year, but that is all Take-Two paid him personally, excluding health benefits. Feder’s checks come from privately held Zelnick Media, a management company founded by Take-Two Chairman Strauss Zelnick.
The CEO of all things Grand Theft Auto, BioShock and 2K Sports led his company to a profit of $97 million last year, thanks in part to a little game called Grand Theft Auto 4, which reportedly sold a few copies.
Somehow, we think Feder isn’t living amongst the paupers.