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EA lowers full-year guidance, Pachter says company “”did not have the products that people wanted”

Tuesday, 12th January 2010 07:35 GMT By Patrick Garratt

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EA said last night that full year revenue would come in at $3.6 billion-$3.675 billion for FY 2010, not the $3.6-$3.9 billion previously predicted.

For the fiscal year ending in March, EA lowered profit outlook to between 40-55 cents per share, down from earlier outlook of 70 cents to $1 per share, and below analysts’ expectations of 79 cents per share, as polled by Thomson Reuters.

The publisher blamed the revision “primarily the result of weakness for EA and the overall packaged goods sector in Europe in December, and a product mix shift to lower margin distribution products in the December quarter, primarily in North America.”

Revenue for the company’s fourth quarter is expected to be $1.227-$1.247 billion.

Wedbush Morgan’s Michael Pachter told Yahoo the company “did not have the products that people wanted” and should be acknowledging that rather than “blaming everything on the environment.”

“This company lacks introspection,” he said. “Their core business is not performing well and they can’t explain why.”

In November, the company cut its work force by 17 percent, or 1,500 people, and announced it had paid $275 million to buy social game-maker Playfish.

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3 Comments

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  1. Blerk

    This is somewhat ironic, because I’ve bought more EA games in the last two years than I think I have ever done before. I guess I’m not ‘people’. :-|

    #1 4 years ago
  2. Grimrita

    People get bored of buying the same crap year in year out. Despite key releases like The Sims 3 – which hasnt sold as well as the Sims 2 simply because many people couldnt get this to work on their current PCs. The Sims 2 would even work on crappy PC world offerings.

    C&C series even more stale than NFS/Medal of Honor and they clearly do not innovate in anything they make. Hell, even Star Wars: The Old Republic is heading down the ‘WoW cookie cutter’ path and is in danger of becoming yet another WoW clone in a Star Wars frock

    #2 4 years ago
  3. OlderGamer

    I doubt PC sales have much of an impact one way or another on the companies over all numbers. I believe by Core Business, they are refuring to EA traditional markets – mainly EA sports.

    I do, however, agree that EA has made some very poor choices in the recent past. I also feel that the larger market share that is being enjoyed by ACTI may well come at the expense of EA. And despite what game companies might like to believe, there is only room for so many games. People, core gamers, casual gamers, or whatevergamers are only going to buy so many games in a given year.

    As far as EA sports they are missing the boat so to speak. Instead of 60usd games each year. They should be releasing DLC that updates last years version. Then offer a store based “Expansion” retail disc for offline players to update their already purchased version of said game. And make each of these expansions fully contained games. Much like the way they did/do with several of their Rockband games.

    There is no doubt in my mind that EA sports will be sluggish in sales under their curent model. In fact i would say the sequel heavy thought process in general is catching up to EA. I suspect the samething for most games in future.

    How many yearly updated versions of CoD, FIFA, Halo, Uncharted, Madden, Guitar Hero, NFS, Forza, or almost any big name game do we really need? And more importantly, how many can the market take before it collapses under the weight? It isn’t just EA.

    It has been a problem for awhile now, and I suspect that because EA is so franchise heavy, that it giving them trouble now. Their biggest hurdle? Finding a new way to market an old product is not as inovative as marketing a new and fresh product. And they fail to see that.

    #3 4 years ago