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EA could lose $80 million in revenue should NFL lockout lead to cancelled season

Thursday, 9th June 2011 17:47 GMT By Stephany Nunneley

EA has said that revenue derived from its Madden NFL franchise could cause the firm to lose up to $80 million should the National Football League lockout leads to a canceled season.

Speaking with Bloomberg, EA Sports president Peter Moore told the financial new outlet that EA is currently working with the league as well as the NFL Players Association to “minimize the potential impact of a lockout-shortened season,” on sales of EA Sports’ NFL-developed games.

Moore estimated the loss could be as low as $70 million or as high as $80 million with the lockout’s impact hitting 35 percent of revenue, which is stark contrast to the potential loss of $165 million analysts predicted in the New York Post. Analyst Michael Pachter believes the impact could go as high as 50 percent of the sales Madden NFL.

“You do get concerned that the attention of sports fans goes elsewhere,” Moore said. “People not only get disenchanted, they get angry.”

Stock prices for Electronic Arts fell 63 cents, or 2.7 percent, to $22.72 yesterday on Nasdaq, yet shares in the firm are up 39 percent for the year.

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4 Comments

  1. OlderGamer

    Maybe they should cancel their game this year and use the time to improve it for next season?

    #1 3 years ago
  2. freedoms_stain

    Can someone explain to me what this lockout thing is in terminology that someone who has zero interest or experience in American sports will understand?

    #2 3 years ago
  3. DSB

    It’s the opposite of a strike. The teams prevent the players from coming to work, and I assume that a lockout in that case means losing whatever perks they might’ve had coming from the teams.

    Strike = Workers rejecting terms. Lockout = Employers rejecting terms.

    In a sad twist of irony, the people with the best organisation and union support in the US are often also the richest.

    You can ask yourself what good a union does a multi-millionaire NFL player, when clerks, cleaners and farmworkers are pulling minimum wage or less.

    @1 Keep the faith. I’d say that Madden is easily the best example of how bad the greed has gotten with all the ingame advertising.

    #3 3 years ago
  4. Stephany Nunneley

    @2 – @3 is right – what it is the NFL and the NFL Players’ Association are negotiating a new bargaining agreement before the 2011 season starts. The last bargaining agreement was back in 2006 and it extended into 2011.

    But, NFL team owners opted out of the agreement two years later and went ahead and played last year’s season with a salary cap in place.

    So, since the current agreement (which was signed in 2006) expired back in March, the two entities cannot seem to agree on salary terms so it is looking likely that there will be a cancellation of the season – BUT – neither party wants this (because all will lose money in the deal and that is all they are concerned with) so they asked for federal mediation.

    This is why the government has stepped in – and what or why the government should care (just like with the steroid use in baseball) is beyond me. But I guess that is also beyond my limited knowledge of the sports and government connection.

    This happens in all sorts of sports all the time around here. A lot of people think the players are at fault because it all boils down to salary negotiations and that the players are not happy with the “gazillions” they are already getting. I have no bone to pick in that one, so I will not say my opinion on it one way or the other. :D :D

    #4 3 years ago

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