Here Is What EA Thinks About PS4/Xbox One Upgrades

"Our business model is so much more diverse now than it has been historically that the notion of a console cycle becomes somewhat irrelevant."

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During an earnings call today, Electronic Arts CFO Blake Jorgensen was asked to respond to the swirling rumors that Sony and Microsoft may be planning to launch new PlayStation and Xbox consoles.

Jorgensen said he doesn't have any inside knowledge to share, but explained that if it were to happen you might see the new devices offer backwards compatibility support.

"In terms of any mid-cycle upgrades, I can't predict," he said. "What I can tell you is what we've heard publicly from the console makers: they are realizing the compatibility issue across consoles is an important consumer issue."

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He specifically mentioned the Xbox One's backwards compatibility support, which was introduced in November 2015. The PlayStation 4 lets you stream back-catalog titles through PlayStation Now for a price, but this is not exactly similar to the Xbox One's version of backwards compatibility.

Sony's rumored Neo console, the apparent codename for the new, more powerful PS4, is rumored to support both standard PS4 games and the new ones. For its part, Microsoft has talked about how it hopes your library of games can move with you across devices.

"That's going to be an important part of what a mid-cycle [hardware upgrade] might look like if there is one," Jorgensen said. "It removes a lot of the risk associated with what we've seen historically with console cycles."

The EA executive went on to say that EA isn't losing sleep over the possibility of new consoles coming before the current generation is over. This is in part because of the fact that EA now uses one single game engine--Frostbite--for all of its projects. This is an adaptable engine that EA can use to make games in a variety of genres and for different platforms--including potential new ones.

Jorgensen further explained that EA is not sweating the possibility of new consoles because the company has such a diverse lineup of other income sources.

"Our business model is so much more diverse now than it has been historically that the notion of a console cycle becomes somewhat irrelevant in our ability to generate strong earnings and cash flow," he said.

"So we'll all be interested to see where Microsoft and Sony come out if they do something at E3 or sometime in the year to come. We're excited about the continued growth in the business and not afraid of a cycle change if that was to occur."

Finally, during the call, Jorgensen provided an update for how many combined PS4 and Xbox One consoles he expects there to be in the market in the coming months. By the end of the calendar year, Jorgensen said he expects an additional 25 million PS4/Xbox One consoles to be sold, adding to the 55 million that were in the market at the end of 2015. This would mean the total install base for current-generation systems will be 80 million by the end of this year, if Jorgensen's prediction comes true.

For more on EA's announcements today, check out the stories below.

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