AI
ERTS $54~$50~? sees Q1 -$0.28 to -$0.22 vs -$0.19 Reuters consensus; sees revs $300-340 mln vs $421.76 mln Reuters consensus '
Electronic Arts: Conf call summary (54.50 -0.04) -Update-
ERTS downgraded to Sector Performer from Outperformer@CIBC
CIBC downgraded shares following the company's lowered guidance on increased costs. They see increased risk with the company's R&D investments and the potential for market share losses
As they look ahead they say they are going through more than a console transition, more a global transition, saying there are opening mkts, all about connectivity. Cos priorities for FY07 include: 1) NextGen platforms, expect to expand SKU count; 2) online, launch Pogo in China and Europe, they expect to build more download able content, and develop and launch 2 causal games in Asia; 3) mobility, co wants to expand presence globally; 4) expand on wholly owned intellectual property; and 5) globalization, by FY07 they expect to have more than active 300 deployment personnel. FY07 R&D spending, Co expect core studio R&D spend to increase 5-10%, R%D spending in mobility to increase 55%-60%, online R&D to increase 80-90% YoY. FY07 R&D should increase 15%-20% YoY. 2006 mkt outlook remains the same. Co says this is a year with many uncertainties. Shortfalls in PSP and XBox would hurt co. Co says greater complexity brings higher risk. FY08 goal to reduce R&D as % of rev, but too early to speculate. Decline in rev guidance is partially due to the co being in a transition year, and they anticipate that consumption will be down. Says that the price cut on PS2 has helped, seen impact in catalog and retailers.
Electronic Arts: Conf call summary (54.50 -0.04) -Update-
ERTS downgraded to Sector Performer from Outperformer@CIBC
CIBC downgraded shares following the company's lowered guidance on increased costs. They see increased risk with the company's R&D investments and the potential for market share losses
As they look ahead they say they are going through more than a console transition, more a global transition, saying there are opening mkts, all about connectivity. Cos priorities for FY07 include: 1) NextGen platforms, expect to expand SKU count; 2) online, launch Pogo in China and Europe, they expect to build more download able content, and develop and launch 2 causal games in Asia; 3) mobility, co wants to expand presence globally; 4) expand on wholly owned intellectual property; and 5) globalization, by FY07 they expect to have more than active 300 deployment personnel. FY07 R&D spending, Co expect core studio R&D spend to increase 5-10%, R%D spending in mobility to increase 55%-60%, online R&D to increase 80-90% YoY. FY07 R&D should increase 15%-20% YoY. 2006 mkt outlook remains the same. Co says this is a year with many uncertainties. Shortfalls in PSP and XBox would hurt co. Co says greater complexity brings higher risk. FY08 goal to reduce R&D as % of rev, but too early to speculate. Decline in rev guidance is partially due to the co being in a transition year, and they anticipate that consumption will be down. Says that the price cut on PS2 has helped, seen impact in catalog and retailers.
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