EA Q2 – Battlefield 3 ships over 10 million units

Thursday, 27 October 2011 22:05 GMT By Stephany Nunneley

EA has posted increased revenue for Q2 ’12 thanks to a surge in its digital and sports offerings, and CEO John Riccitiello noted that Battlefield 3 has shipped over 10 million units since its US launch.

FIFA and Madden lead Q2

Net sales of $1.03 billion were reported for the three months ending September 30, which is a 17% increase. Revenue hit $715 million compared to $631 million to year-over-year. Net losses were up, though, despite the good news, from $201 million to $340 million, mainly due to advertising expenses leading up to the holiday sales season.

FIFA 12 sold in nearly 8 million units and Madden NFL 12 sold in over 3 million units in the second quarter. FIFA 12 sales were also up 25% compared to FIFA 11.

Including digital and mobile downloads, FIFA 11 sold in over 16 million units life-to-date. Battlefield Bad Company 2 has now sold in nearly 11 million units life-to-date.

“EA had a strong quarter on the strength of FIFA 12, Madden NFL 12, and The Sims Social,” said CEO John Riccitiello. “Battlefield 3 is off to a fantastic start on sales and quality, and we are preparing to launch two more blockbusters: Need for Speed The Run, and Star Wars: The Old Republic.”

EA expects revenues for the Q3 to hit around $1.55 to $1.65 billion due to The Old Republic and Battlefield 3. For its full fiscal year, the firm expects revenues to hit somewhere between $4 billion to $4.2 billion, up from a previous guidance of $3.9 billion to $4.1 billion.

The firm’s western market segment held a 25% share in the September quarter, increasing its share by 4 percentage points versus last year. EA had six of the top 20 selling games in western markets: FIFA 12, Madden NFL 12, NCAA Football 12, FIFA 11, NHL 12, and The Sims 3.

Due to the firm’s strong “games as a service model,” EA plans to continue offering engaging “services” year-round for titles such as FIFA, Madden, Mass Effect and Need for Speed. The titles will continue the extension into social and mobile platforms and continued DLC releases for PC and console.

“This is a strategy that only EA can deliver on,” said Riccitiello. “Our competitors either have fewer brands, or have not demonstrated the ability to project their games onto multiple platforms.”

The full financial release can be read through here.

Digital business expands

Digital was, indeed, the big winner on EA’s books with The Sims Social 8 million daily active users helping digital revenue hit $216 million in sales, which is a 30% increase yoy. The Sims is now the second-most popular game on Facebook behind Zynga’s CityVille. At present, according to CFO Eric Brown, less than 5 percent of players pay to play, on average, players play two-to-three times a day for 15 minutes at a time.

“We are pleased with our results with digital growing at 30% year-over-year,” said CFO Eric Brown. “We are raising our fiscal 2012 non-GAAP revenue guidance, our digital revenue guidance, and the midpoint of our EPS guidance.”

The firm now over a $1 billion in digital sales for the year, which is something “only a handful of companies in the world,” have accomplished.

EA also reiterated Origin’s 6 million users, and the fact that Capcom, THQ, and Warner titles would start hitting the service for pre-order in November.

Mobile game sales were also up 87%.

Battlefield 3 scores in the US

Battlefield 3 pre-sells hit nearly 3 million units, as reported previously. The PC version is selling extremely well, but data is not available yet on which version of the game is selling through more than the others. The game was the biggest launch day ship title ever for the firm, according to EA COO Peter Moore. The game has shipped over 10 million units, and retailers are in the process of requesting more copies from the manufacturer.

In comparison, launch sales for Medal of Honor were “a little bit less,” according to Riccitiello.

“I think it was like 3 to 4 day one, and over the course of the first month, we got — over the first couple of weeks, we got 2 by 5,” he recalled. “So it’s actually larger than that. Of gapping it over Battlefield: Bad Company 2, I call Bad Company 2 between the two would be the best way to think about that.”

EA said it has seen unprecedented numbers logging into the BF3 PC servers, and issues due to the peak numbers should be resolved by the weekend since the firm has now “got a handle on it,” according to Labels president Frank Gibeau.

A “robust set of expansion packs,” are planned for release over the next six months, and in terms of engagement, the Battlefield community has “the highest engagement rates inside of Electronic Arts in terms of the online play,” according to Gibeau, and EA plans to cater to said engagement going forward into the competitive shooter season.

“First and foremost, we have a fairly aggressive downloadable content plan out in front of us,” he said. “We’ve already announced the Strike at Karkand Map Pack that is going to becoming available and we’ll be constantly updating on the servers and infrastructure with new features and enhancements. Our plans over the next 6 months is to have a very robust set of expansion packs past on Strike at Karkand and that we think the community’s going to be very, very excited about.

“With regards to your question about this fall, in terms of looking at the overall market, we expect that we’re going to grow share in our overall shooter business, and we see that the overall category’s going to grow share. So I think that looking at past periods isn’t probably the most indicative thing to trend out what’s going to happen next, also Medal of Honor’s a very different design than Battlefield. Battlefield is a tremendous multiplayer online game, 90 rated across-the-board in terms of its multiplayer. I mean, it has a very different offering than the other competitors out there.”

When it comes to the single-player versus the multiplayer in a game like Battlefield, the single-player experience is “important,” as the multiplayer and there are no plans to ditch the single-player experience in the series, just because the multiplayer has proved to be very popular.

“Single-player is often how new players ramp into the game,” said CEO John Riccitiello during the investor Q&A. “It’s the way new players usually get exposed to a franchise.”

“I think you have to have both, and clearly the multiplayer is the richer opportunity for us because of the services opportunity in keeping a customer engaged 365 [days a year],” added Gibeau. “It’s a great question because we consider Battlefield an online service. First and foremost, that brand was built on its multiplayer prowess, and the technology really lends itself to that.”

Star Wars and the pre-order Republic

When it came to discussing Star Wars: The Old Republic, at present, EA doesn’t have any expectations for the number of subscriptions in SWTOR yet, but the firm is excited about the level of interest and said pre-orders are the highest for any PC game ever for the firm, also something previously stated.

“In terms of pre-orders, we haven’t announced anything specific, [but] I can characterize them though as very, very strong,” said Gibeau. “They’re the highest preorders that we’ve ever had on a PC game so we’re feeling very good about the momentum and consumer demand out there.

“In addition to that, we really haven’t set the expectations for what the subscriber levels are going to be. We’re very excited about the potential of the game coupled with the mass-market license like Star Wars. But as we get closer, that will be information that we can communicate further.”

The roll out of the game will be detailed at a later date, and at that time, EA will also detail how it will go about letting people log into the servers.