Midway CEO David Zucker canned after Sumner Redstone stacks up huge losses

This one isn't exactly a surprise to those following Midway lately: CEO David Zucker was shown the door today after years of big losses and no revenue growth. (Read the whole story here.)

Sumner Redstone, who owns 87% of Midway, can't be happy with the returns he has seen since buying the company in 2004. His daughter Shari, who took over as chairman late last year in a little noticed corporate coup, didn't mince words in a statement announcing Zucker's departure. None of that "David has done a great job but has achieved his goals and wants to spend more time with his family" claptrap we usually get when someone gets fired. As far as press releases go, this is pretty much as harsh as statements go in my experience:

"Dynamic new leadership is needed to bring Midway to its full potential,” said Shari Redstone, Chair of the Board. “I believe that Midway has the resources and creative capability to once again be competitive with the best in the videogame business. The Board is confident that a new CEO will be selected who can fully utilize the opportunities presented by this next-generation console cycle to renew Midway’s position as a major player in the videogame industry.”

Here are some rough stats I calculated that show just how badly Midway has done for Redstone since he acquired it:

-Midway's net losses since 2004: about $300 million

-Revenue growth from 2004 through 2007: -3%

-Increase in net loss from 2004 through 2007: +399%

-Change in Midway stock value from the day Redstone took over through today: -79%

-Loss in equity value for Sumner Redstone: Over $500 million (this is a very conservative estimate given that Redstone's exact stock ownership has fluctuated over the years)

While the company has done OK with franchises like "Mortal Kombat" and "NBA Ballers," it has been plagued by delays and seen some significant disappointments, most recently "John Woo Presents Stranglehold" and "Unreal Tournament III."

Probably not what Sumner Redstone had in mind when he took control of Midway in April 2004 and said "Midway is clearly a second-tier producer, but it has the potential to be in the first tier, and that's what attracted me to the company. You're going to see an enormous infusion of talent in the very near future."

I should note, by the way, that in all my interviews with him, Zucker always seemed like a smart guy. I would suspect he has an interesting story to tell about what went wrong at Midway, though who knows if we'll ever heard it.

While Midway's board (basically, Sumner and Shari and those they approve of) search for a new CEO, the company has appointed senior VP of worldwide studios Matt Booty as interim CEO. Wondering about his gamer credentials? The photo on the right is the one he uses for his corporate bio on the Midway website.