Weak Euro sales force lower guidance from EA
Decline in boxed software sales in Europe and lower margins in the US hit Madden publisher
Electronic Arts has lowered its financial outlook blaming weak sales of boxed games in Europe and lower margins on products in the US.
The Madden and Need for Speed publisher reduced full-year guidance from $3.6-$3.9 billion to $3.6-$3.675 billion, expecting a loss of $1.94 to $2.24 per share. Third quarter revenue – which includes the Christmas period – is expected to be between $1.227 and $1.247 billion.
Data from Chart-Track yesterday revealed that the boxed product sales in the UK had dropped by 18 per cent in 2009.
"We continue to think EA has missed the current hardware cycle and is unlikely return to historical operating income margin levels," commented Doug Creutz of analyst firm Cowen Research.
EA announced back in November that it will axe another 1500 positions in an effort to save at least $100 million annually. Net losses increased 26 per cent to $391 million for the second quarter.