Electronic Arts Announces Drop in Quarterly And Annual Net Revenue
A bit more than a month after announcing it was laying off 350 people — or 4% of its staff — Electronic Arts on Tuesday announced a drop in net revenue to $1.24 billion in the year’s final quarter compared to $1.58 billion during the same period last year.
Net revenue for the fiscal year, which ended on March 31, was $4.95 billion, down from $5.15 billion the prior fiscal year. Looking forward, the company announced that its slate of sports titles — which includes the latest “Fifa,” “Madden NFL,” and “NBA Live” — will be hitting in the second quarter of the fiscal year along with “Sea of Solitude.” The highly-anticipated “Star Wars Jedi: Fallen Order,” “Need for Speed,” and “Plants vs. Zombies” are all planned for a third quarter release.
“FY20 will be a year of continued growth for our industry, and we’re excited to bring more great entertainment to the expanding audience around the world,” said CEO Andrew Wilson in a prepared statement. “Players are engaging with games in more ways than ever before. We’re committed to meeting them where they are with a broad portfolio of amazing new games and live services, choice of engagement models including free-to-play and subscriptions, and new opportunities to play, compete and watch.”
EA COO and CFO Blake Jorgensen said the company will be delivering deep live service content for a slew of its titles including “Ultimate Team,” “Apex Legends,” “The Sims 4,” “Anthem,” and “Battlefield V.”
In March, Wilson announced that the company was laying off about 350 of its roughly 9,000-person staff.
In the brief, open letter announcing the layoffs publicly, Wilson noted that the move was made to “address our challenges and prepare for the opportunities ahead,” and to “better deliver on our commitments, refine our organization and meet the needs of our players.”
Specifically, Wilson said changes are being made to its marketing and publishing organization, operations teams and that the company is “ramping down our current presence in Japan and Russia.”
“These are important but very hard decisions, and we do not take them lightly. We are friends and colleagues at EA, we appreciate and value everyone’s contributions, and we are doing everything we can to ensure we are looking after our people to help them through this period to find their next opportunity. This is our top priority.”
While the quarter saw the release of both “Anthem” and “Apex Legends,” the first game was poorly received and the second — a free-to-play battle royale shooter from Respawn Entertainment — may be experiencing a drop in players. While EA hasn’t released updated numbers since the game reached 50 million players in its first month, viewership of the game in action has seen a massive drop. Last month, StreamElements reported the number of hours people spent watching “Apex Legends” fell from over 40 million in February to just over 10 million in March. Twitch viewership and Google searches are down substantially as well, according to Seeking Alpha. Streamers like Ninja and Dr. Disrespect have returned to other titles like “Fortnite,” with the latter comparing “Apex Legends” to Daybreak’s failing battle royale game “H1Z1.”
Seeking Alpha notes that much of “Apex Legends’” early traffic wasn’t organic, instead EA spent millions on getting popular streamers to play and promote the game, according to the site. The game, according to Seeking Alpha, makes up a substantial portion of the company’s valuation and a drop in popularity could significantly harm EA.
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