EA posts sizable loss, but touts big Sims 3 sales
There may be an economic recovery in the works, but video game giant Electronic Arts has a way to go before it joins the party.
That seemed to be the message Tuesday, when EA reported its first-quarter results, the highlights of which were mixed: On the one hand, it reported a quarterly net loss of $234 million, or 72 cents a share, compared with a loss of $95 million, or 30 cents a share, for the same quarter a year earlier. But on the other hand, its big summer release, The Sims 3, appears to have gotten off to a great start, moving an impressive 3.7 million copies since its June 2 launch.
For the quarter, EA said it brought in $644 million in net revenue, down 20 percent, compared with $804 million a year earlier.
The quick start for The Sims 3 isn't surprising since it is part of one of the best-selling video game franchises in history, and because the game in June set a company record for first-week sales of a PC game.
EA also touted the performance of games like EA Sports Active and Fight Night Round 4, which it said also drove sales for the quarter.
Still, despite strong results for games like The Sims 3 and EA Sports Active, EA has to deal with the reality that its business is struggling in the face of the economy. Of course, it's hardly alone. During June, industry sales across the board were down 31 percent from the same period a year earlier.
Daniel Terdiman is a staff writer at CNET News covering games, Net culture, and everything in between. E-mail Daniel. 
It's the other way aroud. Revenue increased compared to a year ago, not decreased.
"(RTTNews) - Electronic Arts Inc. (ERTS: News ) reported a GAAP net loss for the first quarter of $234 million or $0.72 per share, compared to a GAAP net loss of $95 million or $0.30 per share for the year-ago quarter.
Non-GAAP net loss for the first quarter was $6 million or $0.02 per share, compared to a non-GAAP net loss of $135 million or $0.42 per share in the prior year quarter."
ERTS lauched it's main franchise, that's where the extra revenue comes from and is still on the red, with nothing comparable to Sims 3 to lauch. The cost cutting mesures are done, there is very little wiggle room for managment. Tomorrow we will see a rally, i for one will not be a part of it, i have no trust in ERTS catalog for this xmas season or it's ability to generate revenue now that The Sims 3 is out.
Non-GAAP net revenue for the quarter rose 34% to $816 million from $609 million a year earlier. Sales were driven by launches of The Sims? 3, EA SPORTS Active?, and Fight Night Round 4.
Amazing how accounting works. EA sold more titles this year, however due to GAAP it actually shows less sales. Isn't accounting fun?!
Hey EA, you are so worried about that 3% over there you have angered the other 97% who actually pay your livelyhood. Funny thing, that 3% will ALWAYS be there. I don't say ignore it, but stop letting it drive dumb decisions. Work on pleasing the other 97%. Your current actions are driving the other 97% to either drop you or join the 3%.
It is time that the industry as a whole quit focusing on the 3% who will alwys try to get something for nothing and focus on the 97% who will pay. I am not saying that you do nothing, but your current focus and actions are driving your paying customers away.
I 100% agree with your statement.
- by millahnna August 17, 2009 4:22 PM PDT
- Given that the SIms 3 forums are in revolt at the moment (people are getting banned for asking for site policy clarification and linking to Google.com) I think their losses are about to go way up.
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