Saturday, June 15

Unity Chief Resigns After Pricing Backlash

John Riccitiello, the chief executive of Unity Technologies, abruptly stepped down on Monday, less than a month after a change to the company’s pricing structure infuriated thousands of software developers who rely on the video game company’s tools.

Unity, which makes the underlying software that powers video games, has long imposed an annual licensing fee on developers. But in September, the company said it would begin charging developers additional money each time someone downloaded one of their video games. That meant developers would pay more as their games increased in popularity. Mr. Riccitiello was one of the main proponents of the change.

“It’s been a privilege to lead Unity for nearly a decade and serve our employees, customers, developers and partners, all of whom have been instrumental to the company’s growth,” Mr. Riccitiello said in a news release. “I look forward to supporting Unity through this transition and following the company’s future success.”

Unity did not give a reason for Mr. Riccitiello’s departure after nine years at the company. He was also the company’s president and the chairman of its board of directors. Unity did not respond to a request for comment and Mr. Riccitiello could not be immediately reached for comment.

His swift exit underscored the precarious position Mr. Riccitiello found himself in after an attempt to fix a corporate balance sheet awash in red ink. But the abrupt shift in the company’s financial model angered many programmers who rely on Unity for their own businesses.

When Unity announced its new fee structure in September, developers, including those who make some of the world’s most popular mobile games, like Among Us and Slay the Spire, criticized the changes. Someone even called in a threat that required the company to inform federal law enforcement officials and evacuate two of its offices. Unity soon rolled back some but not all of its planned changes.

James Whitehurst, a tech industry veteran, will temporarily replace Mr. Riccitiello as interim chief executive as Unity conducts a search for its next C.E.O., the company said. Mr. Whitehurst was previously a senior executive at IBM, and worked for years at Red Hat, Delta Air Lines, and the Boston Consulting Group.

Unity said in its statement that it was sticking with the guidance it gave earlier for its third quarter earnings report. The company expects to see continued revenue growth, though it remains unprofitable.

Mr. Riccitiello is no stranger to controversy. He spent nearly two decades at the video game giant Electronic Arts, including a stint as chief executive, and gained a reputation for trying to squeeze money out of games in ways that sometimes frustrated players.

He once floated the idea to stockholders that players might be willing to pay a dollar every time they needed to reload their virtual guns while playing Battlefield, a popular first-person shooter game. In 2013, Mr. Riccitiello left E.A., apologizing for the company’s poor financial performance.

At Unity, which he joined the following year, he once said developers who did not find ways to charge players money quickly were “idiots,” prompting a wave of condemnation.

Mr. Riccitiello led the company to a successful initial public offering in 2020. But Unity’s stock price has declined since then. The company’s advertising business, which makes up more than half its revenue, has been threatened by changes Apple made to its mobile devices that limit the amount of data it can collect from users.