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EA's Quarterly Profits Down 31%

Posted by Zonk on from the no-love-for-madden dept.

On the heels of announced layoffs, Electronic Arts reported reduced profits for the just-ended quarter. From the Gamespot article: "Whether the layoffs propped up EA's stock is debatable, as its share price lost over 2 percent of its value, $1.18. Trading was heavy indeed--twice normal volume, in fact, with 7.3 million shares changing hands. And no wonder: Shortly after the US markets closed, EA announced its earnings for its third fiscal quarter, which ran from October to December 2005. Besides being of great import to stockholders in the world's biggest third-party publisher, the report was seen by many as being a bellwether of the game industry's overall health."

2 of 77 comments (clear)

  1. They treat their customers like shit by Aceticon · · Score: 5, Insightful

    EA is the worse company in the industry in terms of the way how they treat their customers.

    Just look at the whole mess around BF2 (Battlefield 2) - they had a game with the potential to be the BEST FPS of the decade an what did they do:
    - Rushed it out the door with many bugs, unoptimized code (you need 2GB memory to be able to play it properly) and unbalanced gameplay (unbeatable airpower anyone?).
    - Did not release a proper fix for several months. Even now it's still an unbalanced hog of a game.
    - Instead of fixing the game, they invested their resources into getting a (payed) game expansion released after just a couple of months. This actually made the game even more demanding in terms of system resources and less stable. A second expansion is scheduled to come out this month.
    - The game expansion added new weapons that could also be used in normal maps. Said weapons were more powerfull than the ones available to players with only the original version of the game, thus meaning that those with the expansion had a built-in gameplay advantage. This is pretty much the sleaziest way to push an expansion i've ever seen in this industry.
    - All the while, any support requests registered in their site were magically going to the status "solved" without them actually solving anything.

    Basically these guys keep treating their whole client base as (fanboy) teenagers and kids (which a lot of them are), while the demographics of gamers has been steadily changing in the last decade and the 25-35 year old males now form one of (if not the) biggest group of gamers.

    Notice that 25-35 year olds have a lot more disposable income than teenages and kids ....

    Meanwhile the rest of the industry has actually moved out of the 1990s mentality of "people are used to games that crash so we can rush them out the door"...

    I am not surprised at all that EA's profits are significantly down.

    Still, i hardly expect that EA's management will take the blame - i'm sure that, somehow, it was all due to software piracy ...

  2. It's all because Godfather was delayed by Jarnis · · Score: 5, Informative

    Their profits tanked, because their 'biggest' christmas title, Godfather, was delayed. Apparently it was so buggy and incomplete that even EA could not hash together a shippable build in time for holidays, and now it's been pushed back to late spring.

    One 'major' title is easily 20-30% of their bottom line in a quarter.

    Now the reason why they aren't improving otherwise is because they treat their customers like shit, and are ran by clueless idiots that chase the quick buck over long-term sales and customer loyalty - bit like every other megacorp on the planet.