Electronic Arts has reported a net loss of $1.08-billion for the fiscal year ending March 31, 2009. That is double the already staggering $500,000 losses registered in the previous financial year.
While EA managed to increase their revenue from $3.6-billion to $4.2-billion year on year, the publisher also greatly increased its expenditure, ultimately making for yet another non-profitable year for the company.
The fourth quarter of the past fiscal year (Jan-March) was not as disastrous as many analysts expected, with EA registering just $42 million down the drain. The fact that the loss in the final quarter was not as bad as anticipated is largely attributed to games such as Skate 2, Rock Band 2, The Lord of the Rings: Conquest, Left 4 Dead and Need for Speed Undercover selling well.
Alarm bells were ringing at the end of Q3, a three month period in which EA managed to lose $641 million. Following this period, EA admitted overdoing it in 2008 and announced that it would be cutting back on expenditure. The publisher went on to shed 1,100 employees (11 percent of its workforce), and close down 12 of its facilities. The publisher also announced that we would see around 30 percent less EA games in 2009 than we saw in 2008.
An annual loss of over $1 billion may sound bad now, but bear in mind that $641 million of that was burnt in one three month period. EA has since done some restructuring, and managed to get the losses down from $641 million in Q3 to $42 million in Q4. EA effectively managed to decrease their losses by over 90 percent from Q3 to Q4, a definite sign that the publisher is at least on the right track.
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