NEW YORK (TheStreet) -- Electronic Arts (EA) shares were taking a beating Thursday on the news it had suspended future projects and expansions until glitches for the recently-launched Battlefield 4 were attended to. Shares tumbled 6% to $21.01 by market close.
Speaking with IGN, the video game developer said releasing fixes for the bug-riddled first-person shooter game was a top priority. DICE, an EA-owned, Swedish developer, is responsible for the game's patches. It is not known how this will affect future video games EA has in the pipeline, including Star Wars: Battlefront and Mirror's Edge 2, due for release in 2015 and 2015/16, respectively.
A related drop in sales would significantly hamper EA's December-ending quarter. In late October, the Redwood City, Calif.-based business forecast third-quarter sales of $1.65 billion and net income of $1.22 a share. Prior to news of Battlefield's issues, analysts surveyed by Thomson Reuters predicted $1.24 a share on $1.66 billion in revenue.
Rival video game producers including Take-Two Interactive (TTWO) of Grand Theft Auto fame and Activision Blizzard (ATVI), publisher of Call of Duty, sold off in sympathy. Take-Two shed 1.3% to $16.39 and Activision was down 2.7% to $16.78.
TheStreet Ratings team rates Electronic Arts Inc as a Hold with a ratings score of C. The team has this to say about their recommendation:
"We rate Electronic Arts Inc (EA) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share and compelling growth in net income. However, as a counter to these strengths, we find that revenues have generally been declining."