How to Lose a Billion Dollars (And Live to Tell The Tale)

The Billion-Pound Wake-Up Call

Picture this: it’s 2006, and 美国艺电公司 —a company that had been printing money selling packaged games through retail—has just lost a billion pounds. Not a typo. A billion.

This wasn’t just a bad year; this was the kind of loss that fundamentally reshapes a company’s DNA. The internet was rewiring how people played games, and EA’s tried-and-tested business model wasn’t just showing cracks—it was crumbling beneath their feet.

"We seriously underestimated how difficult that transition would be for the company," reflects Andy Billings , EA's former Head of Profitable Creativity, in a recent conversation that left me thinking deeply about how companies navigate massive disruption. After steering one of gaming's largest organisations through multiple waves of industry transformation for 25 years, Billings has unique insight into what it takes to reinvent a company while keeping the engines running.

The House That Scepticism Built

Rewind to Silicon Valley in the late 1980s. When EA moved into its first proper offices, something fascinating happened—something that perfectly captured the industry's uncertain status at the time. The building's investors were so sceptical about the longevity of video games that they specifically designed each floor to be easily convertible for "real" tech tenants. Games were seen as a passing fad—a toy industry that might evaporate at any moment.

EA itself wasn’t immune to this scepticism. They hedged their bets, developing paint programs and financial spreadsheet tools alongside their games. "We treated things with the idea that maybe it wouldn’t last forever," Billings notes with a hint of irony, given that the industry now reaches over 3 billion players globally.

It was in this era of uncertainty that EA’s founder, Trip Hawkins , made a moonshot bet on gaming’s mainstream future with 3DO. While that particular venture didn’t land, it exemplified something precious that seems increasingly rare in today’s industry: the courage to imagine beyond the next quarter.

The Unexpected Path to Transformation

What struck me most about my conversation with Andy is how EA's most powerful changes often started small. While the industry pursued scale, some of EA's most transformative moments stemmed from intimate gatherings and focused leadership programmes that brought together small groups of creative minds in unexpected ways.

The company's response to their billion-dollar crisis wasn't just about technology—it was about fundamentally reimagining their relationship with people and players. They launched EA University, not as a traditional corporate training centre, but as an embedded force for change. "EA University always went to the game teams," Billings explains. "The learning format was the game you're making."

They created intimate programmes, bringing together groups of 10–12 people for six to eight months at a time, which were held at various global locations to expose these future leaders to global markets, cultures, and have a deeper understanding of the global player base. These weren’t traditional management sessions—they were playgrounds for reimagining the future of gaming. "If you can take your existing people who are not quite ready and accelerate their readiness," Billings explains, "that’s a huge business advantage."

The proof? Today, about a third of EA’s C-suite are alumni of these programmes.

The Wake-Up Calls

The journey wasn't without its stumbles. EA learned hard lessons with SimCity 4, their first major online service game. When the servers crashed at launch, leaving players unable to access their cities, the fallout was severe enough to lead to the resignation of their then CEO, John Riccitiello .

Later, winning the "Worst Consumer Company" award two years in a row served as another brutal wake-up call. The company responded by fundamentally reimagining its relationship with players, embedding them deeply into the development process and bringing them into studios early to test concepts and provide feedback.

Beyond the Bottom Line

What fascinates me about EA's story is how relevant it is beyond gaming. Every industry faces its own version of digital transformation, and the lessons are surprisingly universal:

Transformation runs deeper than technology. EA's journey wasn’t just about adopting new tools—it was about fundamentally rethinking their relationship with customers and their own identity as a company.? Something that has been somewhat lost in recent years.

Cultural change requires intentional architecture and moments of discomfort. Through leadership programmes and internal universities, EA built the capacity for change into their organisation's DNA, creating a learning engine that could adapt to whatever disruption came next.

The future belongs to those who can balance creativity with commerce. As Billings puts it, the challenge is "how to harmonise profit, creative development versus entertainment just developed for the fun and joy of it." But this isn’t just about profit margins – it’s about creating spaces where genuine human experiences can flourish.

Looking Ahead: The Coming Wave

As our conversation wraps up, Billings shares a thought that feels particularly relevant in today's ever-changing world: the opportunity ahead lies in "how we're going to harness all of this technology to create even more immersive, interesting, and engaging story experiences."

This speaks to a deeper truth about innovation: technology is just the beginning. The real transformation happens in the spaces between—in those rare moments when the right people come together with the courage to imagine something new.

"Disruption is probably one of your constant companions as an organisation," Billings reminded me. "You might survive one set of disruptive forces, only to have a few quiet years and then face further disruption."

Perhaps that's the most valuable lesson from EA's billion-dollar tale—it's not just about surviving one massive transformation, but about building the capacity, communities, and connections to create the conditions where magic happens, again and again. And sustaining this magic means continually welcoming new generations into the fold, drawing strength from diverse voices across gender, age, race, and nationality—because only a company that mirrors its global player base can truly understand and serve it.

It's this understanding that points us toward an even deeper truth: The true potential of our industry isn't in chasing the next technological breakthrough, but in using whatever tools we have to create moments that resonate on a fundamental human level. Because, at the end of the day, our responsibility isn't just to push boundaries but to push them in service of something meaningful, something that matters.

Until next week,

Peter

Catch the full conversation now on YouTube or listen on Spotify, Apple Podcasts, or wherever you get your podcasts. For more insights on leadership, creativity, and innovation, subscribe to the Before 5 on Friday newsletter and get stories that challenge, inspire, and spark your imagination, delivered straight to you every week.