Despite a booming videogame biz this year, two of the industry’s biggest publishers saw their stocks come under pressure Wednesday after somewhat disappointing earnings reports.
Electronic Arts, which recently lost its title as the No. 1 third-party publisher to Activision, said revenue fell 4% in the quarter ended June 30 to $395 million, while net loss increased by 63% to $132 million. Loss, however, was less than some analysts expected.
While the company did note that its bestselling games included “Harry Potter and the Order of the Phoenix,” “Command and Conquer 3” and “The Sims 2 Pets,” it didn’t label any of them as million-plus sellers, as it usually does when any titles reach that mark.
EA is in the midst of a big reorganization in which new CEO John Riccitiello has divided the company into four divisions, brought in outside execs to oversee two of them, and is trying to devote more resources to Nintendo’s popular Wii and DS console.
EA raised revenue guidance for the full fiscal year ending March 31 by $100 million to between $3.2 billion and $3.5 billion, but Wall Streeters were report-edly somewhat underwhelmed by guidance for the current quarter, which calls for revenue between $485 million and $570 million. EA shares closed down 1% at $48.10 before earnings were announced and were down another 1% in after-hours trading.
Publisher THQ also reported a drop in revenue, by 25% to $104.5 million. Net loss actually improved by 23% to $9.3 million, but that was driven largely by a one-time tax benefit.
THQ’s one game that shipped over a million units in the quarter was its adaptation of Disney/Pixar toon “Ratatouille.”
While the company re-affirmed revenue guidance for the fiscal year of between $1.12 billion and $1.15 billion, Wall Street seemed disappointed by guidance for the current quarter calling for revenue of approximately $240 million.
THQ shares fell 5% to $27.34 after earnings were announced Wednesday morning.