Still in the game?
Sony announced a big reduction in its quarterly net profits and its shares took a kicking accordingly. At close of trading on 25th July Sony shares we $40.81, at the end of last week they were $37.83, down 7.3 percent. Interestingly, the games divison was the only one that over-performed for Sony.
EA did even worse. Despite a doubling of year-on-year net revenue it also managed to pretty much double its net loss cue to increased development and marketing costs. EA's shares were $47.73 at the end of 25th July and $42.90 at the end of last week, a drop of 10.1 percent.
Activsion Blizzard is EA's biggest competitor in the games publishing market. It was from a merger with Vivendi Universal Games (VUG), which was completed last month, and look on the name of VUG's most successful developer Blizzard, the company behind the rampantly successful World of Warcraft online world.
The standalone figures for Activision revealed a 32 percent year-on-year increase in revenues but, unlike EA, this translated to a doubling of net income. Furthermore Activision Blizzard CEO Robert Kotick, fresh from handing over his seat on the Yahoo! board to Carl Icahn, said: "We have completed our transaction with Vivendi and our integration plans have identified higher than anticipated cost-synergy opportunities."
It will be interesting to see how EA deals with this adversity, having been at the top of the pile for so long. It has been trying to buy Take 2, publisher of the hugely successful Grand Theft Auto franchise, for a while but hasn't got there yet.
