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EA Posts Billion Dollar Loss

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EA Posts Billion Dollar Loss

If you've bought in to the idea that the video games industry is recession proof then prepare to be shocked: EA has posted a net loss of $1.088 billion (~£732 million) for the last year.

That's a notable decline on last year when EA's loss was a lesser $454 million. Revenue improved year on year, however, up 15 per cent from $3.665 billion to $4.212 billion suggesting the problem isn't as simple as EA not selling enough games.

EA had 31 titles with over a million sales in 2009, which is four more than 2008 with Spore shifting two million copies and FIFA 09, Madden NFL 09 and Need for Speed Undercover breaking the five million sales mark. EA's Digital Services revenue improved 27 per cent year-on-year and EA Mobile's revenue improved 24 per cent year-on-year to $189 million.

EA sounds confident that is set up to see good performance this financial year, with several big titles coming, including EA Sports Active, with which EA will debut Wii Motion Plus.

Link:

EA Investor Relations.

smc8788

May 6, 2009, 7:00 pm

Here's my plan to get EA back on track:





1. Stop bundling crippling DRM software with your games.


2. Don't release the same game year-on-year with incremental upgrades.


3. Stop punishing your paying customers through DRM just because you're pissed some people pirated your games.


4. Make your entire back catalogue of games available through Steam, and scrap your own crappy digital download service.





And most importantly,





5. SCRAP DRM!

Simon

May 6, 2009, 7:03 pm

Regardless of the loss, i am sure all the Top Exec's still get fat wages packets and bonuses.

Hamish Campbell

May 6, 2009, 7:15 pm

I'm hoping these guys have had some years with big profits, can't find a record of their previous results.





Then again maybe there is some creative accounting going on and this is all just a big tax break thing for them or some holding company.

Helmore

May 6, 2009, 7:16 pm

So EA had no explanation for their loss? Seems odd.

Jay4d0

May 6, 2009, 8:25 pm

@ smc8788 - couldnt have put it better myself


but I whole heartedly agree that the DRM, specifically secrom, is to blame there must be at least 7 games I have not bought because of this and I know plenty of people who feel the same.

alchobot

May 6, 2009, 9:33 pm

some of this is due to bad customer support and people like me not purchasing thier games anymore, they need to stop the shovelware. If you look on the EA UK forums at battlefield 2 you will see DICE are now finally trying to make a 4 yr old game playable, thier losses have made them take notice of thier customers. also as above get rid of drm it only effects customers not pirates and get rid of stupid incrementals, BF2142 was a full priced mod of BF2.

xenos

May 6, 2009, 11:50 pm

"BF2142 was a full priced mod of BF2."





And not even a good one at that, I still play BF2 with an XP dual boot as it just doesn't play quite right on Vista x64.





I'm another that has boycotted several games because of DRM, Spore was the last one that I was going to get but didn't, I got RA3 as I'm a die hard fan but WTF do u need 2 user names and a password to login for? And whats with activating a certain computer to play the game? Isn't it enough that only one user can log in at once anyway?





Noobs.

Chocoa

May 7, 2009, 2:22 am

"...suggesting the problem isn't as simple as EA not selling enough games..."





Yea it does seem odd that such sales result in mega losses. If the revenue is improving and the losses are as reported it does beg the question where all the increased revenue is going? And not just possible fat exec bonuses etc. The old chestnut of them complaining about piracy does not wash if revenue is good. At the end of the day a business in about input cost vs output costs the difference being profit or loss!





If it was my business I'd be damn worried!

Cub

May 7, 2009, 8:50 pm

All this talk of DRM... I'm going to have to remember this next time I get into a Console Vs PC Gaming discusion.





Another step for their getting back on track would be reasonable use of DLC. That is, not charging a fortune for things that either should cost pennies/cents/other, or just should have been in the game from the start. Burnout Paradise seems to have escaped this all until recently with their hideously over-priced car-packs (can't argue much given everything we got for free with the game!), but every other piece of DLC I've noted coming from EA is waaay over priced!

TheFlyingGerbil

May 9, 2009, 12:24 am

I don't think it is to do with the recession (what with revenue being up). It seems to be a problem with a lot of publishers - games companies just don't seem to be well managed. Either that or they just haven't managed to work out how to make this gen profitable yet since production costs are so high, and the number of games that are canned before they get released.

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