EA reports loss, record full-year revenues

Company reports 27 million-selling titles in past year, lays claim to top publisher title in Europe, North America.

The growth of the gaming industry as a whole means publishers are posting bigger numbers than ever, and a wave of consolidation is only going to further inflate those totals. Electronic Arts is a prime example, having been the largest third-party publisher in the world even before last year's high-profile acquisition of developers BioWare and Pandemic, or the ongoing attempt at a Take-Two takeover.

EA today announced its full-year results for the 12 months ended March 31, and the company again laid claim to a number of titles, including the number one publisher across all platforms in both North America (where it claimed a 19 percent market share) and Europe (20 percent). EA also touted its position as the biggest third-party publisher of Wii games in Europe, making up 15 percent of the market there as opposed to just 7 percent in the previous year.

Counting sales from all regions, EA said it had 27 titles reach the million-sold milestone during the year, with 15 of those going on to break the 2 million barrier. In the previous year, EA had 24 million-sellers, with 10 titles going double platinum.

For the full year, EA posted net revenues of $3.67 billion, up 19 percent from the previous 12 months. However, due in part to the change in its accounting practices that caused a nearly $300 million hit to its second-quarter revenues, EA posted a net loss for the year of $454 million, compared to the previous year's bottom-line profit of $76 million.

For the fourth quarter alone, EA sales surged 84 percent year over year to $1.13 billion, up from $613 million for the same period the year before. In a conference call with investors, the publisher attributed the boost to strong sales from new releases like Burnout Paradise (1.5 million copies) and Army of Two (1.8 million copies), as well as continued sales of Rock Band (1.5 million copies in the January-March quarter alone).

For the current fiscal year (ending March 31, 2009), Electronic Arts is expecting revenues between $4.9 billion and $5.15 billion, with a return to profitability on earnings per share between $.25 and $.52.

As of press time, Electronic Arts were up more than 1 percent to $55.15 in after-hours trading.

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Discussion

101 comments
iceyintel
iceyintel

[This message was deleted at the request of a moderator or administrator]

skyline7284
skyline7284

@fishnpeas1 MySims Rock Band Black Just 3 off the top of my head, if you need more lemme know

valdarez
valdarez

To darkride66 - I don't see why it would be so low with $1.50 per share in expected earnings by Q3. I didn't verify if what you say is correct, if it is though, then that guidance would have definitely been upgraded after sales data of GTAIV was released. I don't know that $28 is enough to get the stock at this point. Of course, I don't want EA to buy Take Two either. I view EA as a very bad company that hasn't produced a quality product / IP of it's own in years and who constantly churn out low quality games that are marketed / hyped well beyond their potential to increase sales. I think a lot of gamers have caught on to the EA trend and while it might be small, there are definitely a lot of them who are voting with their $$$ by not buying EA games, myself included.

darkride66
darkride66

@ valdarez. Prior to this whole buy-out buisness the one year target on Take Two was only $19 for 2008, and even this was in doubt due to the previous delays on GTA4. If they delayed again there probably would have been a downward revision on this price. $17 is right where the stock should be with GTA4's launch. I don't know if the EA buy out will go through though. S&P thinks EA will raise it's bid to $28 but I don't know. They just dropped their bid from $26 to $25.74.

ps3thabest
ps3thabest

ea needs 2 close down make some good games

valdarez
valdarez

To darkride66 - Looking at their charts, I don't believe that the GTAIV price was baked in at all, on any level. Take Two's stock price hadn't seen any type of movement upwards, and I wouldn't have expected it to start until at least 2 months before the release of GTAIV, or until it was marked as golden, since it had been delayed before. The only thing the EA offer did was hurry up that price movement by a month or so. EA just snagged another Billion in funding though.... so it will be interesting to see just how high they want to take their evil offer. IMHO they have to go above $30 to buy the company now, and even then I'm not sure if they can get enough of the shareholders to sell.

darkride66
darkride66

@ valdarez. What can I say? GTA4 was priced into the $17 Take Two stock months ago and if this deal falls through, back to $17 it'll go. It looks like we should have an update next Monday. Let's watch and find out.

Petri87
Petri87

@fishnpeas1 - Skate, Army Of Two, Black, Dead Space, Boom Blox , Facebreaker and an unannounced IP and thats from the top of my head. And origionl IP referes to a something that a company has created whitout licensing and that includes sequals just if you dont know what origional IP means. Thats how the bussines works. THQ would die whitin a year if they scrap their licensed games and if it weren't for blizzard and guitar hero so would activison. Licenced games sell and thats what keeps companys like EA, Activison and THQ able to make games.

Petri87
Petri87

[This message was deleted at the request of the original poster]

valdarez
valdarez

To darkride666 - That's now how it works? Please. Follow any of the major companies before a title is released, and you'll see a small spike a month or two ahead of the release of a title, and then another month or two of upwards climb if the title continues to sale well. EA's most hostile take over attempt in gaming history (which is a BAD thing for everyone, gamers, employees, companies) was opportunistic and not in the interest of Take Two, or their share holders, which is why the share holders aren't selling. Instead of offering a premium, they were basically offering them what the company was worth after GTAIV was released, shattering all records in the process. EA tried to steal Take Two and got caught. On the positive side, last I checked, EA only owned 8% of the out standing shares. Lets hope Take Two can stay independent of the EA Empire.

cometkd
cometkd

EA maybe when Madden 2009 comes out sales will Increase a lot more! Because if i am correct that is really where it all started right? Go back to basics what got u here. Cause i am still not convinced. -Go Browns!

jknight5422
jknight5422

Yes. Yes. It sounds like it's time for EA to walk away from Take-Two & look at trying to survive in the coming years...rather than taking out a $1 billion loan to invest all the eggs in the one (ie, TakeTwo) basket.

Vampire_Turtle
Vampire_Turtle

EA wake up and smell the bacon! If you make better games you make more money!

Richmaester6907
Richmaester6907

Bit greedy is an understatement for EA really isn't it

klugenbeel
klugenbeel

So you revenue is up, but profit is down...and you want to buy more gaming companies like Take 2....Is it me, or are they just trying to buy everything up and hope it turns a profit?

d3vilg0d
d3vilg0d

EA is a corporate co. and not a gaming co. like activision(I don't like blizzard so they don't count).They us projected figure to release a game and it's more feasible to buy an establish IP then develop your own."Gotta make it rain for them suits"

darkride66
darkride66

fishnpeas1 said "I tell you what, I'll keep my opinions of both working there and their game quality to myself, and you can keep buying endless titles with the date in them and then paying extra for a weapon, a car or some other inconsequential item in their games. OK?" :) Deal! You know, DLC must pay off for them but I don't know who buys that stuff. Same thing for Themes and picture packs. Craziness...

markharris31
markharris31

I'm surprised there aren't MORE mindless EA bashers in this forum. Kudos to the 3 or 4 posters who think before they write. You know who you are. I'm glad you were here to repeat what we've been saying in every other forum to those who refuse to listen to reason.

fishnpeas1
fishnpeas1

So? Swish, nice comeback there. I tell you what, I'll keep my opinions of both working there and their game quality to myself, and you can keep buying endless titles with the date in them and then paying extra for a weapon, a car or some other inconsequential item in their games. OK?

darkride66
darkride66

fishnpeas1 "The quality EA titles you are probably referring to have come from external studios that EA have bought out." So?

fishnpeas1
fishnpeas1

The best thing to do is to take the EA originality test. How many original IPs can you name that EA have CREATED (not bought) since 2004? These cannot be sequels just in case you are unsure what an original IP is...

fishnpeas1
fishnpeas1

KingTuttle - 6 Months with EA was more than enough to be honest, horrendous company to work for. The quality EA titles you are probably referring to have come from external studios that EA have bought out - name a good title that was produced internally... and without a "08" in the title...

StarFox-Elite
StarFox-Elite

[This message was deleted at the request of the original poster]

slickr
slickr

Hmmm, one would suspect that EA is doing some kind of cheesy thing here, despite having 2 years of record sellings in a row it posted losses this and the previous year. It smells like tax avoiding and hiding real numbers to make it look normal!

darkride66
darkride66

I also think it's funny how people like to bash big ole corp monster EA, like they're the only company that takes on smaller studios. Take Two themselves gobbled up 9 independent studios in the past 4 years, and now their management wants to streamline and focus only on their best sellers. Sounds innovative, doesn't it? Poor little Take Two.

Nineball2112
Nineball2112

darkride66 posted: "@ Nineball2112. I feel your pain." Yep, I know you do. :D I don't know who's more foolish... the mindless drones posting all their twisted and unsubstantiated "facts" or me responding to it. :P haha...

Nineball2112
Nineball2112

4grobert posted: "Oh, and a reported loss generally does not mean a real loss of money. It is all about how you report your money and not always about your real profit/loss ratios. That is why a change in accounting style can have such a major impact on your reported fiscal results." And GeigerdolylWodd posted in response "Sounds a bit like dishonest business practice to me. Do you work for them? Al Capone was arrested for less. Tax Evasion, I believe is what its called. The police could not touch him...But the IRS could..." Not to be too mean, but Geigerdolywood, you have NO clue what you are talking about. I know accounting looks weird to most people, but 4grobert was correct with what he posted. Just because you have an irrational hatred of EA doesn't mean that they did anything "illegal" or wrong with their financials.

KingTuttle
KingTuttle

fishnpeas...EA has published a ton of good games (BF series being my favorite)...even if you were telling the truth (I find it sad that you have to spout out like that honestly...very desperate) about your gig with EA that even lessens your credibility. Why did you leave in 6 months? Thats unstable job hopping. Doesn't look good on the resume.

darkride66
darkride66

@ Nineball2112. I feel your pain. :)

Nineball2112
Nineball2112

AGGG!!! I'm sorry but when I read stuff like this from people posting on here: It just makes me want to scream. 1. EA hasn't taken out a loan YET! They have only confirmed that it's available to them if they want to get it. 2. This loss is due to a change in it's accounting practices. Based on what little information was given in the link about it, it appears that they changed the way they are reporting their revenues. It appears to be so that their revenues are reported more in line with when they are earned, ie. matching reported revenues with sales to the end user. It's pointless I know... No one listens around here... just parroting the same old tired talking points... *sigh*

Sins-of-Mosin
Sins-of-Mosin

Now that I own a 360, I don't care what EA does because they make tons of games for it so whatever they do, just don't stop making games.

darkride66
darkride66

fishnpeas1 said "How little I know? Okies - lets see how little I know shall we? 6 Months working community management within EA...etc..etc" And still you classify EA's titles as generic and crappy? That's an insult to every hard working game designer that's ever worked for EA. In fact, as I mentioned before, in this gen and the last EA has 170 games scored 80% and up as developer, and another 77 games scored 80% and up as publisher. That looks like a lot of hard work and a helluva lot of quality titles to me.

otanikun
otanikun

Nice one fishnpeas1, nice

faseli
faseli

OK, I cant be bothered to look at names but there has been a lot of rubbish posted in here. Seems to me that everyone twists the truth when they go EA bashing. Hey I am all for it but don't go doing it with fiction! Criterion did produce the original Burnout, as they did Trickstyle and Airblade to mention a few. Aclaim only published it they did not produce it, make it or any other words you can think of for the genesis of Burnout. Thats not to say they didnt have a hand or say in the games creative direction. The reason Criterion produced games as well as middleware, is because quality games running on your middleware results in you selling more middleware. EA aquired the publishing rights to Burnout from Acclaim before they aquired Criterion. And another thing why do people use words like monopoly? If EA do purchase Take 2, in all likelyhood they wont grow their share of the market, they will just maintain it.

fishnpeas1
fishnpeas1

Rikstah All I can say is - eh? How little I know? Okies - lets see how little I know shall we? 6 Months working community management within EA, 3 years community management within SCEE - what qualifies you to be the expert on EA? I've followed EA since they brought out a paint program on the Amiga - so what do you know?

otanikun
otanikun

Good, the money hungry, monopoly generating S.O.B's; how in the hell did they think they could by Take-Two? I know some companies merge to ride on success of a product that isn't theirs but that should be illegal.

zoe256
zoe256

I'm glad, maybe it will push EA to stop trying to take over other smaller companies and churning out more Sims 2 expansion packs and actually make some decent games for a change...

BuzzDroid
BuzzDroid

That we'd actually find some devils advocates here is just lovely

Rikstah
Rikstah

- fishnpeas1 Nah it just goes to show how little you know

fishnpeas1
fishnpeas1

Just goes to show theres a hell of a lot of people still buying generic crappy games out there

devilmaycry2020
devilmaycry2020

AMAZING $454 million net loss and they STILL can afford to buy T2

Vinsanity09
Vinsanity09

so that's why they wanted some of that GTA IV money

rock_solid
rock_solid

ea sucks and they don't even make a profit

basharhassan
basharhassan

JangoWuzHere, I know just as much if not more about EA than you do. Yes they rush games, and concentrate on making games flashy but lack depth. But the fact is, people still buy their games, even their sports games which are only roster updates with a few improvements, if any. Not all their games are crappy either. Face the facts.

Humorguy_basic
Humorguy_basic

Given the size of EA and the profits they make, you can see how video gaming is on the edge. I mean, if the biggest third party publisher by a long way can only make profits in the $100 million mark on revenues of $4 billion, you can imagine what's going on in smaller publishers. Take out the Wii and DS and I think big problems are going on in video gaming and no one wants to tell us what's truly going on other than seeing numbers like the above that the law forces to be disclosed.

JangoWuzHere
JangoWuzHere

Barharhassen really you know nothing about EA they rush games and most of them do suck and their sports titles are the same game with updated roosters its just a joke

justfei
justfei

ea has made some pretty good games, but the thing they are doing to mass effect is quite a put off

RaiKageRyu
RaiKageRyu

Their number of million sellers are staggering.

basharhassan
basharhassan

Its pretty funny how many people are talking bullsh*t about how EA needed Take Two, and how "evil" they are for trying to(and they will) take over Take Two, and how crappy EA games are. Wake up idiots. Here is a few facts for you less fortunate people living in lala land: 1. EA's games are not crappy, otherwise, they wouldn't be making 3.75 billion revenue, and if a company continued to make crappy games, don't you think it would kinda fail in a few years? I don't see EA failing at any point. 2. As much as you gamers love to think of companies as guys who care and sh*t bottom line is, they are businesses, and they are owned by shareholders who want to make profit. They don't own those shares because they care for the company. Their interest is to make money. Money makes the world go round. EA's offer for Take Two was at such a high price that no shareholder in their right mind would want to say no to it, unless they are on crack. Businesses and shareholders are out there to make a profit. The sooner you realize that, the less sh*t people will be talking all the time. 3. Yes, EA buying all these small companies could be killing innovation and are hostile takeovers, but thats the world we live in. Small companies need these bigger companies to survive. Look at how many small developers have closed lately. What would you rather, a small developer closing completely, or taken over by a bigger company, with a chance of making a good game? Sure it could ruin the company's/game's good name, but its better than nothing.