EA game sales weak, company adjusts outlook

Recession spending continues to take its toll on Electronic Arts. The software company yesterday announced its guidance for fiscal 2009 would be adjusted downward as a result of weaker-than-expected sales.

EA's earnings have diminished despite a strong 2008 portfolio of video game releases.

The layoffs and consolidations which EA announced in October, will continue as planned, according to the company. The workforce reduction plan is estimated to save Electronic Arts around $50 million per year through international cuts. Despite posting a 20% higher revenue last quarter, the company suffered from excessive operating costs.

Changes in consumer spending are to blame for the weakened year-end outlook. EA's CEO John Riccitiello's official statement said, "We are disappointed that our holiday slate is not meeting our sales expectations." EA is responsible for some of video gaming's most popular franchises, like The Sims, Need For Speed, Madden NFL, FIFA, and Command and Conquer. The company's 2008 distribution roster was especially promising including such titles as Mirror's Edge, Left 4 Dead, Rock Band 2, and Spore.

The company anticipates a reduced product portfolio for fiscal 2010, which begins next October.