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EA Earnings Show Mobile Gaming Pays Off Big Time

| 8 May 2013 13:55
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Mobile's doing well, but you shouldn't expect a new Star Wars title any time soon.

"As we enter a new fiscal year, EA is well-positioned for dynamic growth on next generation consoles, PCs, and mobile platforms," claims EA's Larry Probst in a press release accompanying EA's financials for 2013, and Probst has reason to be bullish about mobile in particular. In 2013, EA was mobile's #1 publisher, globally. Mobile and digital handheld revenues have increased 21%, year on year, for a grand total of $104 million net revenue. Origin, the service we all love, claims 47 million users, including 20 million mobile users. Digital net revenue overall? Well, that bumped up 36%, for a record $1.7 billion.

Doughnuts and cars were standout products for EA in 2013. The Simpsons: Tapped Out, a free-to-play title in which you rebuild a ravaged Springfield one building at a time, or quicker if you purchase premium currency doughnuts, has generated nearly $50 million in profit since its August 2012 launch.Real Racing 3, another free-to-play where you take your Bugatti or Lamborghini out for a spin, has generated 30 million downloads so far, and has kept the title of #1 racing game on the iOS store since its March launch.

That said, it's not all sunshine in EA land. Probst is in the seat because CEO John Riccitiello departed, primarily because EA - despite the excellent performance of its digital and mobile segments - really didn't have a good year. Moreover approximately 10% of EA's staff has also gone, adding up to a total $27 million worth of severance cost expenses. EA wasn't about to say how much of that $27 million was due to Riccitiello alone. However some of that 10% does come from EA's support staff, and it's worth bearing in mind that poor customer support is one of the reasons why EA won worst company of the year twice in a row. Meanwhile Frank Gibeau of EA Labels was quick to point out that lessons had been learned from SimCity's disastrous launch, and that nothing like it would happen again. "Consumers overwhelming the game servers" were, in Gibeau's estimate, the primary reason for the disaster. EA had some bad news for Star Wars fans; though work's ongoing, you won't see a new game this financial year. So whatever that nebulous Star Wars launch date may be, it'll be coming sometime after March 2014.

Source: SEC Filing, EA earnings call

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