EA Posts Fiscal Q3 Net Loss of $641 million

[celine]

* Oper profit 56 cts/shr vs Wall Street view 88 cts/shr

 

* Cutting 1,100 jobs, or 11 percent of workforce

* Will narrow its game portfolio and delay some games

NEW YORK, Feb 3 (Reuters) - Video game publisher Electronic Arts Inc (ERTS.O) posted weaker-than-expected results on Tuesday and said it would delay several games, causing it to forecast a loss for fiscal 2009.

EA, publisher of popular franchises such as "Need For Speed" and "Madden NFL," said its fiscal third-quarter net loss was $641 million, or $2.00 a share, compared with a loss of $33 million, or 10 cents a share, a year ago.

Excluding costs related to restructuring and other special items, it had a profit of 56 cents a share, far short of analysts' expectations of 88 cents a share, according to Reuters Estimates.

While experts expects the video game software industry to manage the recession better than others, companies like EA have been hurt by tighter inventory management at retailers which don't want to overstock their stores with titles that are not huge hits.

For example, where retailers may previously have pre-ordered 1 million copies of a new title like the latest "Lord of The Rings" title, they may now only order 400,000, and might slow to reorder additional copies, analysts said.

Revenue at EA, which goes head-to-head with Activision Blizzard Inc (ATVI.O) for the title of biggest publisher, was $1.65 billion, up from $1.50 billion.

Analysts had expected $1.9 billion, according to Reuters Estimates.

The company in December warned its fiscal 2009 profit and revenue will fall short of already-low forecasts due to disappointing holiday sales of its video games in North America and Europe.

http://www.reuters.com/article/marketsNews/idINN0353477520090203?rpc=44