Updated from 6:05 p.m. ET

Electronic Arts

(ERTS)

said Tuesday that its December quarter was weak due partly to

Sony's

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PlayStation 2

delivery shortages, but the company offered encouraging news for the long term.

The nation's top independent video-game maker missed Wall Street's revenue estimate by 10%, announcing revenue of $640 million for the third quarter ended Dec. 31. Analysts polled by

First Call/Thomson Financial

expected the company would pull in $710 million in revenue. A year earlier it had $600 million in revenue.

But the company nailed the earnings-per-share consensus estimate of 66 cents. Earnings decreased nearly 6% from the year-ago's 70 cents a share.

Along with the PlayStation shortages, Electronic Arts has anemic consumer demand and evaporating advertising revenue for its

EA.com

Web site. But the well-known PlayStation

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shortages have received the most attention. Sony now says it will ship 9 million consoles by March, down from its earlier forecast of 10 million. That has left EA unable to sell as many games as expected.

In spite of the short-term problems, Larry Probst, EA's CEO said, "We're very bullish on the PlayStation 2 platform going forward. The component problem is short-term and will get corrected. It's real clear that the demand is there. ... The PS2 launch has been a dramatic move forward from the PlayStation 1 launch. In the first two years, 2.5 million PS1s were installed in North America. For the PS2, we expect abut 8 million by year two."

During the conference call, analysts asked about the impact of

Sega's

departure from console production. Sega confirmed reports that it no longer will produce its

Dreamcast

machine, in favor of focusing on software production and new technologies. The company will be free to license its popular games to any console company, creating new competition for Electronic Arts. Sega has said that it will license game titles to

Microsoft's

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Xbox

, and

Nintendo's GameCube

, both scheduled for release in the fall. Electronic Arts also has agreed to provide Xbox games, and John Riccitiello, EA's president, said he "surmises we will be supporting the GameCube when it's launched."

"We welcome Sega into the fray," Riccitiello added. "We think their excellent games being used across many platforms will expand the overall market, driving revenue and profit for us."

EA said it will wait until its fiscal fourth-quarter earnings announcement in April to offer guidance for fiscal 2002.