NEW YORK (TheStreet) - Electronic Arts Inc (EA) surged Wednesday as the gaming software maker posted higher-than-expected sales, paring its loss for the quarter, and announced plans to expand its operations in China.
The Redwood City, Calif.-based company reported sales of $495 million for the three-month period ended June 30, beating expectations and generating a loss of 4 cents per share, less than the consensus expectation of 6 cents per share.
EA was jumping 8.5% to $25.86, its highest price since October 2008.
Top-selling game brands such as Battlefield, Need for Speed and NHL helped drive sales along with more offerings from its sports division. FIFA Online 3, the PC soccer game, will now be available in China."EA had a solid quarter driven by continued digital growth and disciplined cost management," said Executive Chairman Larry Probst in a statement, "We are also executing on a clear set of goals for leadership on mobile, PC, current and next generation consoles." Wall Street analyst ratings for EA breakdown as 16 holds, 11 buys and 1 sell, according to data compiled by Bloomberg. The gaming company continues to face higher operating costs as the company develops new games for Microsoft's (MSFT) Xbox 1 and Sony's (SNE) PlayStation 4. John Riccitiello stepped down in March due his "accountability for the shortcomings in our financial results this year," he wrote in his letter of resignation. Executive chairman Larry Probst continues to act as interim CEO while the company searches for a replacement. EA did suffer a setback when a California district court Wednesday closed a lawsuit by the Madden Football games' original programmer against the company. The jury determined that the statute of limitations had not expired, entitling Robin Antonick, the programmer, to unpaid royalties for EA sports and Madden games he worked on between 1990 and 1996. "With mandatory prejudgment interest, the verdict should entitle Antonick to more than $11 million" wrote the law firm defending Antonick, Hagens Berman, in a statement.
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