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EA makes $186m Q3 loss despite rising digital revenue

Packaged sales fell 18%, but digital revenue now 67% of total earnings

Electronic Arts made a loss of $186 million in the third fiscal quarter, despite strong growth in its digital business.

In the quarter ended December 31, 2017, EA earned $1.16 billion in revenue, essentially flat year-on-year. Packaged Goods revenue declined 18 per cent to $380 million, but that was balanced by a 14 per cent rise in Digital revenue, which reached $780 million for the quarter.

In Q3, EA's digital revenue accounted for 67 per cent of the publisher's entire earnings.

However, EA still made a loss of $186 million, versus a loss of $1 million in Q3 last year. The company's big release for the quarter was Star Wars Battlefront II, which experienced a rocky launch due to a public backlash over its use of loot boxes.

The only data point EA offered with regard to Battlefront II was about its single-player campaign, which almost 70 per cent of all players tried, the company said.

The most encouraging performance was related to FIFA, the console community for which grew to 42 million players by the end of the calendar year. FIFA Mobile, which uses a free-to-play business model, added 26 million players in Q3 alone, while FIFA Ultimate Team's player base increased by 12 per cent between the launch of FIFA 18 in September and the end of the third quarter.

"Through the fourth quarter and fiscal 2019, we'll be launching games across five different genres, on three different platforms, and to players around the world," said EA CFO Blake Jorgensen. "We expect growth in full-game downloads, subscriptions, extra content, and in our mobile business."

For the year ending March 31, 2018, EA expects to earn $5.1 billion in revenue, and $1.015 billion in net in profit.

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Matthew Handrahan avatar
Matthew Handrahan: Matthew Handrahan joined GamesIndustry in 2011, bringing long-form feature-writing experience to the team as well as a deep understanding of the video game development business. He previously spent more than five years at award-winning magazine gamesTM.
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