This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

EA Sees a Blockbuster in Spore

In other words, Spore could meet estimates but that may not be enough to please investors who are looking for more in a market where even the slightest disappointment could have a big negative impact on the stock.

EA also needs to reassure investors who have been holding on to the stock. Over the last two years, EA shares have declined 3.2% while rival Activision's (ATVI) stock soared 55%. Shares of EA closed up 29 cents, or 0.6%, to $48.72 Friday.

The Spore game has been designed for five playable levels -- cell, creature, tribe, civilization and space. In the first level users create microorganisms and try to nourish them and keep them alive. From there they move to the next phase where the microorganisms can evolve into creatures and be organized into tribes.

Next comes the civilization phase where gamers can create cities and when they earn enough points players can launch their civilizations into the space to search for new planets.

Click here for larger image.

A EA spokesperson said the company has designed Spore "to be highly creative, very personal, easy-to-use and easy-to-share."

"If you want to jump into the game, well, there are hours upon hours of fun to be had there. But if you want to just mess around with the editors, create things and show them off to the world, you can do that too," an EA spokesperson said.

EA hopes to more than just sell millions of copies of Spore. The user-generated content that defines the game could help Spore become the cornerstone of EA's ambitious plans to generate more digital revenue.

At its annual analysts meeting this year, EA promised to take digital revenue from $325 million in 2007 to $900 million, or 15% of its total revenue, by fiscal 2011.

Spore, if successful, could help the company get there as EA develops a marketplace to charge users for new premade creatures or other in-game accessories. "We may see Spore define the micro-transaction model," said Pachter.

EA also hopes to release expansion packs, or add-ons to the existing game that could extend the story line, and spin off versions of Spore for mobile and casual games to attract more users and sustain the franchise.

EA's biggest challenge in the next months will be to manage expectations, some analysts say.

"When The Sims was first introduced it was new and revolutionary," said Divnich. "It also changed the profile of the gamer from the typical 18- to 25-year-old male to a more female demographic, which worked in the favor of the game."

By contrast, Spore has legions of hardcore gamers waiting for the title and disappointing them could be costly for the company.

Still, it will take more than a few missteps to stop the juggernaut that Spore has become, says Arvind Bhatia, an analyst with Sterne, Agee & Leach.

" Sims is a billion-dollar plus franchise," he said. "If Spore does half of what Sims does, it will be a great success."

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
EA $62.76 -0.81%
AAPL $130.28 -1.14%
FB $79.19 -1.19%
GOOG $532.48 -1.40%
TSLA $250.75 -0.28%

Markets

DOW 18,010.68 -115.44 -0.64%
S&P 500 2,107.39 -13.40 -0.63%
NASDAQ 5,070.0260 -27.95 -0.55%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs