Slow Sales for EA Augurs Tough Times for Video Game Business

Electronic Arts (ERTS), the largest video game maker in the U.S., released new guidance on January 11, and the numbers were awful. EA said that GAAP sales for its fiscal 2010, which ends in March, will be well below its November forecasts. GAAP net revenue is expected to be $3.6 billion to $3.7 billion for fiscal year 2010, as compared with prior guidance of $3.6 billion to $3.9 billion. GAAP diluted loss per share is expected to be in the range of $1.94 to $2.24 for fiscal year 2010, versus prior guidance of $1.20 to $2.05. EA's shares fell 8% after hours, to about $17.