First quarter profits surge for Electronic Arts

Giant publisher Electronic Arts has announced its financial results for the first quarter of its financial year, revealing a massive 148 per cent leap in profits over last year and exceeding all analyst expectations.

The California-based company announced revenues of $353 million (â'¬307.4m) for the June-ended quarter, well ahead of the $331.9 million (â'¬289m) figure one year ago, and also ahead of market expectations of around $340 million.

More impressive, however, was the profit figure of $18 million (â'¬15.7m), which compares with a year-ago profit of $7.4 million (â'¬6.4) and market predictions of around $4.5 million. Earnings for the quarter, excluding charges, were $19 million.

The company's success during the quarter was driven primarily by titles such as NBA Street Vol 2 and the most recent expansion pack for The Sims, both of which sold over a million copies during the quarter, and Def Jam Vendetta, which sold almost a million units. Sales of much of the company's recent back catalogue continue to be strong as well.

For the current quarter, which ends in September, EA anticipates earnings per share of between 35 and 42 cents (which translates as between $52 and $63 million) on revenues of between $470 and $510 million. NCAA Football 2004, one of the key games released this quarter, has already sold some 400,000 copies in its first week on sale, while Madden NFL 2004 - out in August - has racked up 100,000 pre-orders.

EA is thought to be benefiting from a number of moves in the online space, including the consolidation of its EA.com operation into the main business and the renegotiation of a deal with AOL which sees the company providing content to AOL subscribers rather than paying the service provider for access for its users. "(We went) from paying for access to now being paid for content," CFO Warren Jenson told Reuters.

The company's predictions for the full year put it just shy of being the industry's first $3 billion company, with revenues for the year predicted at between $2.8 to $2.9 billion. Earnings for the full year should be in the range of half a billion dollars.