Big franchises will power a good year for Electronic Arts

Mar 13, 2014 15:16 GMT  ·  By

The recently launched Titanfall shooter from developer Respawn Entertainment and publisher Electronic Arts is expected to ship 2.4 million units during the current quarter of the fiscal year, which ends on March 31, and 6 million for the entire year.

The information comes from an investor note quoted by VG247 that was created by Colin Sebastian, who is watching the video game industry for Robert W. Baird & Co.

The number refers to copies of the game delivered to stores rather than directly to gamers.

The company does not offer any information on how the platform breakdown will look, although Titanfall will probably sell best on the Xbox One and on the PC, mainly because the Xbox 360 version of the game is delayed by two whole weeks.

The investor note states, “Near term, we are adjusting estimates to assume 2.4 million sell-in of Titanfall in F4Q with CY2014 total shipments of 6 million units.”

It adds, “Our cautious view of EA in prior years was originally based on inconsistent financial performance, and a comparatively inefficient cost structure. In becoming more constructive on the stock earlier in 2013, we recognized management’s renewed focus on expense management together with a more realistic approach to guidance.”

Colin Sebastian believes that the faster than expected decline in game sales for the current generation of home consoles will affect the performance of Electronic Arts in the coming year, but that the publisher is well positioned to compensate with launches that target the Xbox One and the PlayStation 4.

The analyst says that the best performing franchises of 2014 will be Dragon Age, UFC, FIFA and Sims.

At the same time, Battlefield 4 is expected to deliver smaller sales than Electronic Arts was initially expecting from the first-person shooter.

In the 2016 fiscal year Sebastian believes that EA could have one of its best years ever as long as it manages to launch the new Star Wars titles that are created in partnership with Disney, while also introducing a new Battlefield title.

Titanfall is expected to get access to at least three downloadable content maps, which are confirmed to include a number of new maps, and the development team has also promised to deliver free updates with new features.

The launch of the title has been largely problem-free, although PC gamers were unable to access it for a while because of a matchmaking issue, and the Xbox One also has some issues with player sign-in.