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News - EA Quarterly Earnings Details, Paring Back Distribution
Written by Caleb Bridge 11 Feb 10

After some hard times, EA's forecast is finally looking up. After their latest earnings report, the publishing giant announced that despite a fiscal third quarter revenue decrease year-over-year, their net loss reduced from US$641 million to US$82 million.

One of the most impressive factors of EA's results were an increase in their digital revenue, which was up 30 percent from this time last year, reaching a high of US$152 million. Over the past 12 months EA have eagerly expanded their digital portfolio, with their acquisition of PlayFish, and the increased use of DLC as a continuing revenue stream in games like Dragon Age: Origins.

Packaged products that were key contributors to the reduced quarterly losses included titles like Dragon Age: Origins, NBA Live 10, FIFA 10, Madden NFL 10, The Sims 3, along with EA Partners games like Left 4 Dead 2, which sold 2.9 million units in the quarter.

While still accepting new titles for EA distribution in the coming year, EA will be reducing their efforts in that particular department. The reasoning being that they would prefer to focus on internally developed titles which have higher profit margins.

"While we have great relationships with our partners, we are modeling a reduction in our distribution business as we concentrate on higher-margin EA owned titles and digital initiatives," said COO John Schappert during a post-results analyst conference call, also noting that a "tighter focus will yield better results".

Finally, EA saw over 1000 layoffs following their recent restructuring, however their current workforce is expected to be about 8,120 employees at the end of their fiscal year, and at this point they plan to be at the same point the following year. Surely good news to any worrying about further restructuring.

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After some tough times, things are looking up for EA


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