Video game stocks tend to be cyclical, enjoying occasional booms on the rising edge of the console upgrade cycle. But Electronic Arts'
EA's quarterly earnings release boasted of the largest revenue in its history, but obviously, all the sales in the world wouldn't have helped. Its third-quarter loss was $33 million, or $0.10 per share, compared to a profit of $160 million, or $0.50 per share, this time last year. That aforementioned revenue increased 17% to $1.5 billion.
EA noted that on a non-GAAP basis, net income increased more than 40%; that doesn't excite me, since I'm not interested in how profitable it would have been had a formidable list of items been backed out. (Most of the numerous items in EA's non-GAAP reconciliation seem to appear quarter after quarter.) Meanwhile, EA lowered the high end of its guidance range for fiscal 2008; it now expects revenue of $3.46 billion to $3.59 billion, and a loss of between $1.67 per share and $1.48 per share. It previously issued revenue guidance ranging from $3.35 billion to $3.65 billion, and predicted a loss between $1.60 per share and $0.91 per share.
Nintendo (OTC BB: NTDOY.PK), Sony
EA may be taking fantasy warfare to Taiwan, but in another notable piece of news, EA said the long-long-long-awaited game Spore, from the creator of The Sims, will release before the next holiday season. Industry watchers had expected it to ship in the spring.
I generally feel more optimistic about Electronic Arts and Activision
Grab your controller and check out some recent EA news: