The Wargamer

In its quarterly report of financial earnings, Electronic Arts announced that although its net revenue increased by about 20%, or $1.126 billion, as compared with $936 million for the prior year, overall they lost more money.  Last year EA lost $195 million, this year was substantially more; $310 million was lost in the quarter.  Unfortunately, this will impact employees, and EA expects to layoff about 6% of its workforce as a result.  

EA's CEO John Riccitiello commented,“Considering the slow down at retail we’ve seen in October, we are cautious in the short term,”

He was more optimistic on EA's future noting that console growth has recently been in the double digits and broadband connections to homes is increasing.  As a result, he said, "EA is well positioned to benefit from these technology drivers due to the strength of our creative studios and our broad collection of game properties from The Sims, to Spore and Madden NFL, to Warhammer Online.”

EA expects to save about $50 million due to the layoffs.  EA stock (ERTS - NASDAQ) closed down 1.1%, or off $0.31 to close at $27.73. 

Readers may recall that last year EA heavily courted Take Two (TTWO - NASDAQ) in the hope of gaining its titles, most notabable among them the Grand Theft Auto series, amongst others.   For a time during merger talks, Take Two's stock reached over $25 per share, though it fell after merger talks failed.  Take Two closed up $0.51 today, or 4.6% gain to $11.67.