Vidgame publisher sees revs spike
Showing signs of strength after a weak holiday season and winter, Electronic Arts saw sales increase 13% to $413 million last quarter.
News drove its stock up 3% in after-hours trading: EA had closed down 1% at $46.52 before earnings were reported.
Net loss rose 40% to $81 million, but that was due to a new policy of expensing stock options; without stock-based compensation, net loss would have dropped 24% to $44 million.
Both the net loss and revenue for the quarter were considerably better than analysts had anticipated.
During the relatively slow spring quarter ended June 30, the No. 1 videogame publisher’s bestselling titles included the FIFA World Cup soccer tie-in and “Battlefield 2: Modern Combat.”
Company is expecting to see revenue rise to between $635 million and $685 million in the current quarter, with a net loss equal to that of last quarter. EA is planning to get close to break-even for the fiscal year ending March 31, based in large part on a healthy holiday season, when it is hoping to ride the coattails of the launches of Sony’s PlayStation 3 and the Nintendo Wii.
CEO Larry Probst said EA is increasing development efforts for the Wii, which garnered much more positive buzz after it debuted at the E3 trade show than the PS3, which has a high $500-plus pricetag. Company is also increasing development for Nintendo’s portable DS system, which is far outselling Sony’s competitive PSP.