US videogame giant Electronic Arts posted a net loss for the 11th consecutive quarter on Monday and said it was cutting 1,500 jobs, or 16 percent of its workforce. EA reported a net loss of 391 million dollars, or 1.21 dollars per share, in its fiscal second quarter, which ended on September 30, compared with a net loss of 310 million dollars, or 97 cents per share, a year ago.
EA said revenue rose two percent in the quarter to a record 1.147 billion dollars behind the launches of "FIFA 10," "Madden NFL 10," "The Beatles: Rock Band," "Need for Speed," "SHIFT" and "NCAA Football 10." The Redwood City, California-based videogame publisher said it was cutting some 1,500 jobs as part of a plan to "narrow its product portfolio to provide greater focus on titles with higher margin opportunities."
It said the plan, expected to be completed by March 31, 2010, will include the closure of several facilities and will result in annual cost savings of at least 100 million dollars and restructuring charges of 130 million dollars to 150 million dollars. EA announced earlier Monday that it has acquired London-based social network game maker Playfish in a deal that could be worth up to 400 million dollars.
EA said it had bought Playfish, which makes games for Facebook, MySpace and other social networks, for 275 million dollars in cash and 25 million dollars in equity retention arrangements for employees. In addition, EA said it will pay up to 100 million dollars if the privately held Playfish reaches certain performance milestones through December 31, 2011. "EA is performing well, with quality, sales and segment share up so far this year," EA chief executive John Riccitiello said in a statement.
"We are making tough calls to cut cost in targeted areas and investing more in our biggest games and digital businesses," he said. EA shares gained 1.02 percent to 19.73 dollars in after-hours electronic trading. EA gained 2.79 percent on Wall Street during the day following the announcement of the acquisition of Playfish.
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