14 DAY TRIAL // Electronic Arts is saying that it plans not to fire any more employees during the upcoming year as it has a better outlook than at the same time last year. For the quarter, which ended on December 31, the company claims to have been the most important third-party publisher in the world, with revenue going over 1.2 billion dollars and with losses going down to about 82 million from more than 600.
It seems that the restructuring efforts the company started under the new Chief Executive Officer John Riccitiello have been paying off. Still, it plans to further change its business model by focusing more on videogames developed by wholly owned studios to the expense of those who are coming from third-party developers.
John Schappert, who is the Chief Financial Officer of Electronic Arts, stated at the presentation of the financial results that “While we have great relationships with our partners, we are modeling a reduction in our distribution business as we concentrate on higher-margin EA owned titles and digital initiatives.”
The EA Partners label, which deals with titles offered by outside developers, will still exist and plans to release both Crysis from Crytek and a yet unnamed shooter project, which is being created by Epic Games. Electronic Arts is saying that PC titles developed internally have a profit margin that can go up to 90%, with console titles going to 60% or 70%. The titles only published by EA never reach the same profit margins, although big releases like Left 4 Dead 2 or games in the Rock Band series are still profitable for the publisher.
The company is expecting the videogames market to shrink by about 3% in the coming year, which it admits as a conservative figure that will inevitably lead to a fall in the revenue it gets.