The troubles are mounting for Electronic Arts.
The videogame company today reported disappointing results for its fiscal third quarter ended December, cut its full year guidance, and announced plans to chop its workforce by 11 percent, or 1,100 people, while closing 12 facilities.
A little bit of vulnerability surfaced in the videogame industry today. Electronic Arts, admitting that its holiday game lineup isn’t selling as well as hoped, warned that its revenue and earnings would be below guidance for the March 2009 fiscal year.
Guitar Hero World Tour couldn’t boost Activision Blizzard’s share price despite a decent debut this weekend. Decent, but not stellar. Wii and Xbox 360 versions of the game were near-sellouts, the PS3 version less so. Good news, then, that UBS analyst Benjamin Schachter thinks the videogame industry could be recession-resistant.
Shares of video game retailer GameStop (GME) are coming under pressure after the company reported sales and profit this morning for the fiscal second quarter ending in July that were well clear of estimates and at the high end of its forecast; it raised its forecast, but nevertheless, may not be seeing the profit upside some expected.
Behold the Power of Potter. Time Warner (TWX) yesterday disclosed it won’t put out the new Harry Potter film, “Harry Potter and the Half-Blood Prince,” this November as originally planned, and instead will make it a Summer 2009, release–specifically, for July 17 of next year.
Videogame software stocks are under some selling pressure today after industry tracker NPD reported April sales that came up short of some estimates.
NPD said video game software sales grew 68% year over year in the quarter. Pacific Crest’s Evan Wilson this morning writes that he had had expected 120% growth.
Again? State after state after state has passed laws that ban the sale of certain video games to children, and time after time after time those laws are struck down as unconstitutional. Not a single one has passed muster, and yet court time and taxpayer money are wasted over and over again on these same issues, with at least 10 states having gone through the same process with the same results. States cannot ban the sale of video games to children. It’s a violation of the First Amendment. This does not mean that stores themselves can’t make such a policy, just as movie theaters have voluntarily (not based on a law) agreed not to let kids see movies of certain ratings.
Last we heard from Atari, the storied video-game maker that’s been floundering for years, it seemed likely that the company was in the process of winding itself down/selling itself of for spare parts.
Viacom’s MTV kicks off 2008 by announcing that it streamed 1.2 billion videos from its music-oriented Web sites last year, and that those Web sites attracted an average of 30 million uniques per month. Viacom has worked mightily in the last year to explain how committed it is to the Web, and frequently trumpets stats like these to make its case (other favorites: 300 Web sites, 90 million uniques across all of its sites, $500 million earmarked for video-game investment, etc.).
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