EA reveals fiscal detail of cost-savings plan
$120 million annual savings versus $55-65 million in restructuring
Electronic Arts has outlined more details regarding its financial savings plan, first announced earlier this month, noting that although restructuring will cost around USD 55-65 million over the next few quarters, the company stands to save USD 120 million annually as a result.
Around 1000 people will leave EA, the majority by the end of March 2009, a move that will cost around USD 30-35 million, while nine studios will be consolidated or closed.
Among those to be shut will be the Black Box Studio in Vancouver, with that team moving to nearby Burnaby. Location-based costs are expected to reach USD 23-28 million, with other asset impairment charges totalling approximately USD 2 million.
"EA is implementing a plan to narrow its product portfolio to focus on hit games with higher margin opportunities," read a statement. "The company remains committed to taking creative risks, investing in new games, leading the industry in the growing mobile and online businesses, and delivering high-quality games to consumers."
EA's share price closed up on Friday by 3.76 per cent at USD 17.39.