No Happy Holidays for 500+ Laid Off by EA

Citing losses and difficult economic news, game publishing giant Electronic Arts announced yesterday that it was laying off 6% of its work force.

That’s more than 500 employees.

As reported by VentureBeat:

During the quarter, EA relied on the staple of its sports franchise, Madden NFL 09, which sold 4.5 million copies. Spore sold two million units. That’s a respectable amount, and the title is sure to sell steadily into the future to mass market audiences. But it’s not the mega-hit that some had hoped for. Another big title was Warhammer Online… EA sold 1.2 million copies…

[EA CEO John] Riccitiello said in a conference call that the postponement of the Harry Potter movie and its accompanying game was a big reason for the shortfall…

In an investor’s note issued moments ago, Wedbush-Morgan analyst Michael Pachter was critical of EA management, while still recommending the publisher’s stock as a strong buy:

EA management was somewhat aloof during [yesterday’s] earnings call. With the stock hovering near a seven-year low, management continued its recent history of disappointment, and spent an inordinate amount of time sowing seeds of fear about the potential for a tepid holiday sales season. EA’s share price in after hours trading reflects that many investors have abandoned hope…


management has demonstrated an uncanny ability to snatch defeat from the jaws of victory in the eyes of investors, and we think that these old habits will take a long time to die…

Seeking Alpha has a transcript of yesterday’s conference call.

GP: We’d have to agree with Pachter. While John Riccitiello started strong when he returned to EA last year, in 2008 we’ve witnessed a series of embarrassments take place on his watch. From the lengthy, abortive attempt to seize Take-Two to the Spore DRM debacle and Ricitiello’s subsequent insult to those who protested, it hasn’t been pretty.

Regarding Spore, while it has done well at launch (thanks to the hype) the game is simply not going to be a Sims-like cash cow in the long run. It’s not as well done as The Sims and lacks the feminine appeal which sustained The Sims over the long haul.

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  1. Wolvenmoon says:

    Have to agree, also have to say my conservative grandfather (Who is a ‘horse’s ass’, his favorite phrase to use when he doesn’t like someone/thing) back when he was a regional manager for citgo petroleum down in louisiana fought, back when civil rights movements were just emerging, for a smart african american kid to be treated equally.

    Long story short an entire station quit because my grandfather demanded-as regional manager-that this kid be treated based on merit. My grandfather, while this kid worked normal hours, was up at that station all but six hours every 24 for over a month and a half working his ass off until they brought more people in.

    He got no more pay than normal, and didn’t complain about it. The kid he advocated for got the job he deserved, and my conservative ‘rich’ grandfather with a high paying job risked his entire career over a cause commonly said to be championed by the liberals of the day.

    Pardon me for the long story. the point is:I haven’t met many liberals even with LOW paying jobs willing to risk it all for someone else. Especially when that other person couldn’t pay them back. Not to say they aren’t out there, but the people championing this ‘tax the rich’ stuff and acting as if they’re robin hood rarely stick their necks out for anyone else.

    Sure, you can tax the rich. You’ll just have the good hearted people who pay up and grumble a bit, and then STILL have the nasty people that evade and dodge the taxes. Start closing them up, and that money leaves the U.S and we start REALLY getting screwed.


    I’m appalled, quite frankly, to see people griping about DRM and restrictions on people meant to punish the bad eggs from one side of their mouth, and taxing the hell out of people willing to play by the rules on the other.


  2. Spartan says:

    I will remember and so will they and their familes and just maybe they will tell all their friends not to support EA products. If it does not change, it will come down one day; of that I’m sure.


    "The most difficult pain a man can suffer is to have knowledge of much and power over little" – Herodotus

  3. Verbinator says:

    Bill Clinton surfed on the wave of prosperity created by the Reagan/Bush I terms. Most folks here aren’t old enough to remember the economic disaster of the Carter (D) years.

    I’m always curious how the Lib talking point that tries to claim "how the rich have benefited most from our society." Most of the people the Libs try to claim as "rich" are really just "successful", meaning they have worked hard, made good decisions, been successful at what they do and contributed to society.  They already pay more taxes than anyone else compared to their income. Because they have been successful, they have been able to purchase things made by others, able to hire people to perform services for them, they are able to invest it in businsses which hire other people and give them good livings, and especially, they are able to give money freely to charitable causes (America is the most generous nation in the world. It’s citizens give more per capita than any other nation). Those things all sound like giving back to society.

    You and many like you (including your Obamessiah), seem to have this Scrooge McDuck image of your imagined rich person. Those rich folk are just swimming around in the piles of money sitting in their big ol’ money vaults. To the lazy, to the unsuccessful, to those who think raising the minimum wage is a way to a more prosperous society; $250,000 seems like a fortune. Yet, the folks making that money, for the most part are working their asses off to get that, and probably took years of working their asses off to get to the point where they could bring that much money in.

    And what you want to do is take it away from them so you can redistribute it as you see fit.

    By the way. Do you know that Liberals are the least generous in society ?( Perhaps that’s why they want to take more money away from folks who make it and redistribute it because they don’t understand charitable giving.

    Oh yeah, and in that Sesame Street skit … I bet the kid spent his WHOLE dollar on the things he chose, not on what the Government chose by taxing it away from him.


  4. jadedcritic says:

    The economists want to know why consumption is dropping?  This is it, this is why. Companies think they can lay off and outsource all day long willy nilly with no consequences, and then they wonder why consumers don’t spend as much on their products.  Unless you’re in music or entertainment of course, in which case you blame your failure on piracy.

    Jokes aside, nothing we do will cause EA’s failure, we should only be so lucky. Frankly, I will consider us fortunate if anyone remembers these sorts of layoffs come January and February when people are wondering why the sales totals from Christmas aren’t what people had hoped they would be.

    Remember, EA, as you sow, so shall you reap. 

  5. Icehawk says:

    Agreed.  This Is the EA that most know and despise.  They want to protect themselves and give the shaft to anyone else, up to and including their consumer base.  What are a few employees to such as these?  Not that I want to see a recession but I find that on some level I would not mind seeing EA suffer and fold.  Have to remember though there are innocents in the line of fire. 

  6. jadedcritic says:

    I feel some sympathy pain for these folks. I got laid off myself back in september and I’m only now starting what I would consider to be a good replacement job. (first day is next monday)  Safe to say I feel like I can understand how they (the layoff-ee’s) are feeling. That said, it doesn’t particularly surprise me that EA would do that.  Particularly with the economic climate being what it is and EA’s reputation for treating their employees like warmed over dog-feces.  Here’s hoping they find replacement jobs soon.

  7. Wolvenmoon says:

    I have to disagree with your economic theory a bit. =)

    My personal opinion is that all taxes should be leveraged at the income tax level, then left alone. Meaning all taxes should be managed by places of employment, which would mean less targets for our tax office, but, that’s not the way it goes.


    My grandfather is a smart man, he played the stock market and before the dot com bubble burst he had over a million dollars in assets. However, because of this if he did so much as move money in a bank he was hit with hefty taxes. It all served to make him very guarded in what he did with his money. Instead of spending and enjoying it, he held onto it. Eventually it crashed and he lost most of it, but he’s still pretty well set for someone his age.

    Anyway, jumping taxes on anyone stagnates that group’s spending.

  8. Wolvenmoon says:

    Well hmm, with a piracy rate of about 33% due to their DRM-which also cost licensing fees, I’m about certain they could have avoided this if they were listening to the people they were trying to sale to.

    Losing your job is a hard, nasty thing. And the heartlessness displayed by EA in doing this right before the holiday season is just what I’d expect from them.

    However, hopefully these people will get jobs and contribute to companies working to please the consumer, and do good work there. Hopefully this draconian treatment of their employees, multiple times in the past half decade (EA spouse story comes to mind), will spark something.

    I’d love nothing more than to see EA’s asshole executives lose their jobs over this. They could have avoided this entire incident, they were just too busy listening to their investors.

    So, 2 million sales of spore? About a million pirated copies? Certainly the loss of investor cash wouldn’t equate to the damage of 50 million dollars plus licensing, then loss of sales on their other games and a general reluctance to buy from them.

    Ending my rant..but thinking of something. Considering EA spouse and previous employee abuse, and the recent launch of spore-which was FOREVER in development, could EA just be firing employees they originally hired on as ‘temp’ employees? The cancellation of Tiberium makes me think this is very likely.

  9. Spartan says:

    See those of us in the "underground" that have been actively organizing people and groups to boycott all EA titles the past couple years are starting to have an impact.

    Spore was a great coming out so to speak. Now we need to get more main stream attention and more vocal people in the ranks. We need more, and more people to join with us and just say no to EA products.

    It will work sooner or later; make no mistake it will work as long as people keep the faith.


    "The most difficult pain a man can suffer is to have knowledge of much and power over little" – Herodotus

  10. Mortium says:

    1st, I hope those EA employees find work and FAST.

    2nd, EAs management needs to go. NOW. A hostile take-over of EA is in order. Kill SecuROM once and for all, and you will see Spore’s sales numbers go up. Get cracking on a Spore Expansion or three and money for years to come.

    3rd, you know, Bill Clinton raised taxes on the wealthy to pay for tax breaks for the poor and middle class and what did we get, the largest economic boom since WWII. The GOP’s answer to everything is cut taxes (on the rich). Economy doing poorly? Cut taxes. Economy booming with a Budget Surplus? Cut taxes (instead of oh, I don’t know PAYING OFF THE NATIONAL DEBT BEFORE THE NEXT RECESSION). They do not have an original, workable idea in their heads. It’s not entirely their fault. They firmly believe government can do no right, that there is not a place for government to improve the lives of it’s citizens (education, health care, disability just to name a few).


    Let me break it down into terms you might grok. Money is finite (yes the pool of money out there grows but in fits and it’s mostly illusionary growth (i.e. stock prices, home value, etc)). Higher taxes on the Rich (who have benefited the most from our society, and by very definition make more than they need to live on quite comfortably in a given year), shake some of that money loose and feed it back into the economy (again, definition of Rich).

    As for the claims of "higher taxes on the rich hurt the economy" no it does NOT. If you shake some of the wealth that the rich have, and pour it back into the economy through things like salaries for government employees (who buy stuff), office furniture and equipment for government agencies (suppliers employ people), programs to help the poor (who will spend every last dime). The Rich will always find ways to make more money. If someone needs a good or service, they’ll find a way to supply it and turn a profit doing it.

    There is a mis-perception that our economy is about the acquisition of wealth. No, it is and has always been about the movement of wealth. Each time money changes hands it has a multiplicative effect on the GDP.

    Anyone remember a Seaseme Street skit from 25+ years ago that followed a dollar from some little boy’s allowance that somehow at the end of the day ended up back in his possession? Think that.

  11. Larington says:

    Or maybe, just maybe, the economic downturn thats hurt every other industries’ share prices has also impacted upon EAs share price. Its no co-incidence this 7 year low is happening during a period of significant unrest and panic in financial/stock-market systems.

    I can’t say I’m at all enamoured with the idea of people judging companies based on their share prices right now, since those have evidently become an unreliable benchmark. And all game publishers have their stumbling blocks and release date push backs, so thats not anything new. Ok, the Take-Two non-Take-Over was a bit embarassing for EA, but do you seriously think they really care in the long run? Ok, so they took a chance which didn’t pay off, at least they’re taking risks once in a while, in an industry where publishers are often risk averse and where games like Dead Space and Mirrors Edge wouldn’t normally get made.


    My sympathies to those losing their jobs. I sort of know how it feels, I’ve been processing mortgage account closures when they come to their natural end for one of the banks in the UK for roughly a year (I’m not giving any more details than that for obvious reasons) and we were told about two/three months back that our office would be closed by March, with the potential job losses (-minus transfers/redeployment) that entails. Fortunately I went over to part time a couple months back because I’m studying for a games development degree, but there are folks there with mortgages, heck, entire families working in the office, so its hard times for some.

    Its a difficult time across the board, sadly.

  12. AuntySocial says:

    Oh, well.  Once I have the last ep/sp for The Sims 2 in my grubby little hands, I will purchase no more from EA.  Yes, that means no The Sims 3 for me.  I will be happy with what I have.  The only way I will change my mind on this?  EA makes a total 180 and stops using securom.   I will not even buy the console games they make.  Call me a pirate!! Yarrrrgh!


    Insanity has its toll. Please have exact change.

  13. Chuma says:

    There’s nothing wrong with having lots of money, but I have objections to these people cheating the system and failing to contribute proportionally to the country they make their money in.  I earn a very average wage here in the UK, which would be around $40K in your money depending on the current exchange rate.  I have voted Lib Dem for the last few years even though they wanted to increase taxes by 1% after the first £15K ($27K) because I feel those on higher wages should be paying a little more tax to help fund things like student tuition fees, the upgrading of the NHS, State Pensions and so on.  Maybe it is because so many of my friends are on minimum wage, or have huge student debts from their time at University but I see it the responsibility of society to give everyone a fair chance and for everyone to pay a fair amount of tax.

    I do not see many Republicans sharing my ideology, and certainly not those with large amounts of cash.  What you are saying has been echoed on news channels here from Republicans since the start of the campaigns.  Any even remotely socialist policies are made out to be like communism and any hint of paying more tax is met with gasps of horror.  And yet, in the UK, we don’t struggle to pay Hospital bills or Ambulance rides and we didn’t lose our State Pensions when the markets collasped recently.  Sometimes it pays to have a country where you pay to look after one another, even with its occasional freeloaders.

  14. deuxhero says:

    Sure blame the the rich. You do realize how sterotypical and ignorant you are?


    YOU go out and run a large company, lets see how well YOU do, and then you might see why they get payed so much, it is a hard job. Any one can make an easy call, but only a few are able to make hard choices. Not any Joe Shome could do something like say… take 200 of the worst preforming locations of a fast food chain and make it number 1 in profitablity, that requires true skill, and someone who does that would deserve  every cent of pay for any possition it gets them too.


  15. Nekowolf says:

    If anything, I blame a large part on the auto industry. First they globalized, throwing out many jobs here, and then they overproduced, making new cars that people couldn’t afford, which lead to further cuts. And now they’re in deep shit. And to fix it? Send out more jobs to countries with much cheaper wages.

    It was their own stupidity and betrayal of the country they were founded in, all in the name of bigger profit. After all, a CEO gets multi-million salary. The heavens forbid they live in anything less luxurious than a $500,000 life style. That’s just too much like those dirty struggling peasents.

  16. farlander28 says:

    Indeed, with Granholm as Governor, things have gotten worse for people and businesses both.. between state income tax going up ~1% to ~4.4%, and the new round of small business tax increases that happened last year, this place is the bottom of the continental barrel. Add to that this "we need more unions" BS, and whole city-sized amounts of people (hundreds of thousands) fleeing to other states PER YEAR, and it paints a wonderful picture of "Gets worse before it gets better".

    Just praying a democrat-led congress doesn’t add another layer of suck for us here.

    "Life sucks, get a fuckin helmet" – Denis Leary

  17. deuxhero says:

    Well tax’s and unions ARE why you are in that mess, it is unfriendly to businesses who would set up shop there, as they would lose much of the profit they make in taxes, and they have to deal with unions (who require higher wages, benifits, and many other extra costs for the company) if they went to Michigan. A businesses would have to be stupid (and if they were, they wouldn’t be makeing a profit in the first place…) to go to Michigan over a state that was friendly to businesses

  18. Chuma says:

    I fail to see how 2% is a lot when you factor in that you will have ALREADY earned quarter of a MILLION dollars before it kicks in.  Sorry but if you are in that position, I have no sympathy for you.  If you are a high earner, you have benefitted from the stupid economic policies of the last 8 years and deserve to help the country recover, or would you prefer the US to go bankrupt?

    As for the first paragraph, I’ll have to admit I don’t know how the tax distrubution works in the US so I cannot contest your account of things, however taxes will still reduce the 10.1 Trillion dollar national debt which basically needs to be brought down to reasonable levels.  And finally, any sentence with the name "Bill O’Riley" in it can safely be ignore.  The sociopathic wanker can go to hell along with it’s agenda funded "news".  Any channel of that bias would be held accountable in the UK for its lies and I find it incredible that not only hasn’t it been sued to hell by Obama over its false allegations, that some people in the Us still believe it to be ‘fair and balanced’… just.. wow.

  19. deuxhero says:

    Except that the 2nd, most of the 1st and a portion of the 3rd are fundend at a local or state level, so rasieing FEDERAL taxes does not help fund them in any way… Not to mention that revnue tipically goes up when taxes are cut, not to mention that Obama has more then once said his plan is not to rasie revenue, but for "fairness", he even admited in an interview with Bill O’Rilley that income can go down when you increase taxes.



    And 2% is a lot when with all the taxes you pay you alreddy pay over half your income in profit alreddy…

  20. Chuma says:

    As I said earlier, the 2% tax increase is only paid on profits OVER $250K so hitting that magic barrier doesn’t mean a windfall tax.  (before you ask, do the police/fire fighters/public services come out of thin air?)

  21. deuxhero says:

    It was never about Joe makeing more then 250,000 a year, it was about Newell Plumbing & Heating makeing 250,000 a year. If Newell Plumbing & Heating makes money, after expenses (taxes, wages ect), the profit is rolled back into the the business and used to hire more people, buy new exquipment, open new branches ect. These result in more jobs (before you ask, does the equipment purchased come out of thin air?)

  22. Erik says:

    What really pisses me off about Mccain and the rest of the republicans is them trying to pass off Joe the Plumber as some kind of average joe regular citizen trying to get by.  Oh boo-hoo, just how will you get by on only $250,000 a year, oh the pain of it all.  Assholes, I really don’t have much pity for rich fucks like Plumber Joe.


    -Ultimately what will do in mankind is a person’s fear of their own freedom-

  23. deuxhero says:

    Lets assume that is a gaft (he is Biden after all), explain Obama’s $120,000 comment.



    Still need to explain how 95% get a tax cut when a lot of them don’t pay income taxes…

  24. Chuma says:

    Bear in mind with the $250K threshhold, if you earn $260K instead, that doesn’t mean you pay the extra 2% tax on ALL $260K, you only pay it on the 10K that is above the threshhold.

    Noone LIKE having to pay tax, but it is essential to turn around the mess that has occured both sides of the Atlantic with our respective leaders.  In the US’ case, Bush has turned a surplus to a deficeit since comign into power and now your $5 Trillion National Debt has more than doubled to $10.1 Trillion (not surprising as he is the only guy to bankrupt 2 Texas Oil companies…).  In the UK, we’ve had to increase spending to deal with the financial crisis which is something Brown said he would never do…

    I know you americans have issues when it comes to tax or ANYTHING that even SNIFFS of socialism, but sometimes you just have to pay a little more for the good of the country.  You either have Obama, who will take it from the top 5%, or McCain who will take it from everyone "equally" (where equally means that those at the top can suffer the losses easily and those at the bottom cannot).  It depends where your ideology and loyalties lie as to where you want to vote.  Here in the UK, predominantly there isn’t a choice to be made – Obama all the way.

  25. Keddren says:

    Sorry, you’re wrong.  Obama’s policy has always been 250/200k.  It has never, ever been said to be lower.  The 150k comment was a Biden gaffe.

  26. Krono says:

    And it was 250,000 for indivduals in the first place, then it was 250,000 for couples, then 200,000, then 150,000.

    No, it was always 250,000 for couple, 200,000 for individuals. They simply talk primarily about the 250,000 one, just like McCain primarily talks about the 5000 one.

    Nor has it lowered to 150,000. Are you that ignorant, or are you just deliberately lying?


  27. barra_sadei says:

    Republicans, such as McCain, say that the Trickle Down theory is the right way to go for the economy. Now, I never said that the economy can’t grow, it’s just that the Democratic "From the Bottom Up" theory has caused more positive growth in the economy. There’s a correlation between Democratic Presidents/"From the Bottom Up" Economic view and I believe intrest rates for savings accounts, bonds, etc.

    But, as for the Trickle Down theory being proven wrong, I have quite a few friends that are Economics majors, and all their teachers have said that it was proven that the Trickle Down theory was an inferior economics viewpoint, and each of my friends added that not many things in economics can be proven like Trickle Down.

    Plus, businesses are businesses, so the Trickle Down theory within itself doesn’t help people on the bottom very much, if at all.

  28. deuxhero says:

    that replaces a nearly $5000 tax break an employer gets for provideing you with health insurance…


    And it was 250,000 for indivduals in the first place, then it was 250,000 for couples, then 200,000, then 150,000.

  29. Krono says:

    The numbers haven’t changed if you’ve been paying attention to anything more than soundbites. $250,000 for couples, $200,000 for individuals. Just like McCain’s $5000 socialist wealth spreading, excuse me health care tax credit, is for couples and is $2,500 for individuals.


  30. deuxhero says:

    Because is TOTTALLY has no connections to Pelosi, Reed or a hypotheical 60 democrat…



    and $250,000? Hasn’t he lowered that by 50,000 twice now? I geuss the 150,000 could be Biden with his foot in his mouth as per the stats quo, but the $200,000 mark came from Obama…



    What about trickle down economics being wrong? I completely forgot how the econmy has improved (and goverment revenu acctualy increased because of this) every time taxes were lowered signicently…

  31. Doomsong says:

    EA also employs several small death squads that monitor game forums and "silence" those who would speak bad of the "Evil Empire".

    "Those who would give up essential Liberty, to purchase a little temporary Safety, deserve neither Liberty nor Safety" – Benjamin Franklin

  32. Captain Sensible says:

    500 people is only 6% of their workforce? What the hell do they do with all the money from the Sims?

  33. jmcc says:

    Unrelated to this story specifically, but are we just not going to discuss EA’s "get banned anywhere in something related to us and we permanantly deactivate all your games we’re able to?" strategy?

  34. E. Zachary Knight says:

    Edge-oline has some comments from EA people about the layoffs. Mostly coorporate speak for, "Our investors weren’t happy with their earnings this quarter so we are fire people to cut costs."

    E. Zachary Knight
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  35. barra_sadei says:

    Actually, as Senator, Obama has no direct control over the state he represents (if that was what you were trying to point out). Anyway, both candidates will lower taxes pretty much across the board. Surprisingly, Obama offers the lowest taxes.

    Also, the Republican "Trickle Down" economic theory can be proven to NOT be effective. Not many things in economics can be proven, so… consider that. And since I doubt that you’re part of a massive corporation that ships jobs overseas, or a small business owner who makes more than $250,000 a year (which few every reach that mark), you have little to fear from Obama. Fear McCain, with his economic belief that has been disproven.

  36. deuxhero says:

    Just wait till Obama gets in office and rasies taxs and you see all the lay offs that come from companys trieing to cut cost (because they don’t make as much to put back into the company) and efforts to avoid unions.



    Don’t believe me? *points to Michigan and it’s single state recession*

  37. DCOW says:

    See Pachter? aren’t you the same person that said that T2 should go with EA? 




    T2 made their choice and it was right. and now EA is blaming their losses on Harry Potter, because you KNOW how much those games always sell.


    good grief. DIE PLZ EA.

  38. Aliasalpha says:

    That really does suck, it seems like every time EA do something GOOD they deliberately fuck it up and do something stupid. Dead Space & Mirrors Edge have both turned out to be something different and really good and I started to get my hopes up that EA might finally have turned around & started to think with their minds & not with their arses. Fat chance.

    Hmm, what really bad things have happened to the gaming industry since the 83/4 crash? I’m guessing most of the worst is the acquisition & dissolution of quality mid-size publishers by EA, choice evaporates, risk is minimised and everything becomes one smooth boring line…

  39. shobidoo says:

    LYERS! Spore has all the femine apeal the cute little creature and masculine apeal too Lyers! that is all

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