EA Shows Third Quarter Profit

Officials from Electronic Arts have posted the company’s third quarter financial results, for the period ending December 31, revealing a smaller than expected sales decline over the Christmas period. During the quarter the company reported a net profit of $375 million, or $1.18 per share, compared with $392.3 million, or $1.26 per share at the same time last year. Revenue also fell to $1.43 billion, from $1.48 billion a year ago. However, the fiscal 2005 figure includes a $47 million foreign currency benefit. Indeed, the company’s slip in revenues was entirely due to its performance in North America, with earnings increasing in Europe by 1 percent and in Asia by 9 percent. Excluding certain items, EA reported a profit of $1.23 per share, which is above analyst expectations of $1.17 per share on revenue of $1.42 billion. The company had nine games that sold more than 1 million units in the quarter, seven of which passed 2 million units. CFO Warren Jenson said widespread shortages of game consoles at the holidays had a mixed effect. "I would say that in North America it was more noise, and in Europe it had an impact," he told Reuters. "It was a very healthy software quarter, regardless." For the fiscal year ending in March, EA forecasts earnings per share of $1.82 to $1.87, or $1.90 to $1.95 excluding items, on revenue of $3.28 billion to $3.33 billion. Analysts had expected earnings per share excluding items of $1.94 for the year on revenue of $3.3 billion.