Electronic Arts lowers guidance for fiscal year after disappointing December
In a sign that financial woes for traditional video game makers may have worsened over the holidays, Electronic Arts Inc. today lowered its revenue and earnings expectations for the fiscal year, sending its stock down 7%.
The publisher of game series such as Need for Speed and Dead Space said revenue for the fiscal year that ends March 31 would be $3.6 billion to $3.675 billion, while diluted net loss per share will be $1.94 to $2.24. Just two months ago, on Nov. 9, the company said fiscal year revenue would be $3.6 billion to $3.9 billion, while diluted loss per share would be $1.20 to $2.05.
EA attributed the softer-than-expected performance to weak sales in Europe in December and a shift in consumer buying habits last month to products with lower profit margins.
The news, which came after markets closed Monday, sent EA shares down 7% in after-hours trading. The company held a conference call at 2 p.m. to discuss the unexpected guidance change.
Investors and industry analysts will probably be monitoring the call closely to see whether it was a result of problems specific to EA or if it indicates larger issues for the video game business.
-- Ben Fritz
Photo: A sign in front of EA headquarters in Redwood City, Calif. Credit: Paul Sakuma / Associated Press