In a sudden and somewhat unexpected move, the board of directors of leading online-gaming software provider NetEnt has jettisoned its CEO, Per Eriksson, in what was described by the company as a move to “increase focus on long-term growth”.
According to a corporate announcement issued late on Sunday, March 26, NetEnt’s board decided to terminate Eriksson’s role as CEO “with immediate effect”. The company announced that recruitment of a new CEO would begin at once and that the company’s current Chief Financial Officer, Therese Hillman, would be taking over as interim CEO until a permanent selection is made.
Thanks, but no thanks
A brief quote offered by NetEnt’s Chairman of the Board, Vigo Carlund, thanked Eriksson for his efforts but laid the blame for what was perceived as substandard overall performance at Eriksson’s feet. Mr. Carlund said:
“NetEnt has developed well over many years and several parts of the business are still developing well, for example in regulated markets, but the overall performance of the Group has not been as it should. The Board believes that NetEnt needs a new driving force to reverse the trend and increase the focus on growth. The value creation potential in NetEnt remains significant. The online gaming market has structural growth driven by the migration from offline to online gaming. The Company has a solid balance sheet and a strong brand name in its segment of the market. The Board would also like to extend its gratitude to Per Eriksson for his time as CEO for NetEnt.”
Mr. Eriksson’s forced departure from his CEO seat came with little warning. He appeared in interviews as recently as a week ago, affirming his company’s commitment to new and innovative gaming solutions and products. His departure ends a six-year run at the helm, which he assumed March 1, 2012, after serving in a similar role at another Swedish firm, Dustin Group AB.
Hillman’s ascendancy to the CEO role, if only on a temporary basis, was rapid. She was hired by NetEnt to take over as CFO in October 2016, and she only began actual work in the role in January of 2017. Prior to that, Hillman served on Unibet’s board of directors while concurrently serving a five-year stint as CEO of Gymgrossisten, a subsidiary of the Qliro Group.
The NASDAQ-listed NetEnt currently employs over 1,000 people and maintains corporate offices in Sweden (its long-time primary home), Malta, Ukraine, Gibraltar, the USA, and Poland. NetEnt was founded in 1996 and offered services in the land-based casino industry before turning its attention to online gaming in the early 2000’s.
Surge in mobile gaming
The company’s results have surged in recent years amid continued online growth, particularly in the mobile gaming sector. NetEnt posted an 11.7% increase in revenue for the full year 2017 as compared with the previous year’s 1.625 billion Swedish kronor (about €159.3m).
Nonetheless, those numbers masked a soft fourth quarter of 2017, in which NetEnt’s expenditure outstripped its revenue. A corporate statement issued by Eriksson in February blamed the results on increased costs connected to product development, as well as the expense of opening “new, larger offices” in its new Malta headquarters.