$641m Q3 losses forces publisher to up previous redundancy estimates
12 unnamed EA facilities are to close and 1,100 additional staff are to lose their jobs in the wake of a third financial quarter that saw the publisher suffer $641 million in losses.
The increase in redundancies will see 11 per cent of EA’s workforce handed their notice, with confirmation that the company plans to reduce its portfolio of games spelling more bad news for developers employed by the huge company.
“Our holiday quarter came in below our expectations and we have significantly reduced our financial outlook for fiscal 2009, a clear disappointment,” CEO John Riccitiello stated. “We delivered on game quality and innovation in calendar 2008, with 13 titles rated 80 or above — more than any third-party publisher. We expect to build on this great quality record in the year ahead while delivering more profitability.”
CFO Eric Brown added: “Given our recent performance and the current economic environment, we are aligning our cost structure with a lower projection of revenue, resulting in approximately $500m of operating expense reductions in fiscal 2010 as compared with our previous plans.”
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Once again EA amaze the world with their business strategy. At a point where EA games are finally getting good notice for their quality, they scythe through development once more...for this is where the axe will fall again. The car parks will still be full in accounts, PR, HR, the fat middle management areas. When will they see they need to slim the top heavy, over burdened business side of it so that the teams they have can make games free from constant fiddling from unproductive expensive middle managers? Lets face it...EA would function better if this round of cuts involved a B Ark...fire the paperpushers...keep the developers. You're supposed to be making games, not over complicated management models....
Oh come now...everyone knows that developers just make the games they're not important. What IS important is that there is a strong vibrant and expensive list of executives to decide on strategy. If games are high quality and a publisher still makes a 6000 million dollar loss, it's clearly because of a poor strategy....er.....
