Expects to save $120m in annual costs
Games software developer and publisher Electronic Arts has announced plans to cut approximately 1,000 jobs, close nine studios and publishing operations, and reduce its product lines.
The workforce reduction, which is expected to be completed by March 2009, is an expansion of a plan announced in October to reduce headcount by 6%.
EA plans to shut its Black Box Studio in Vancouver, British Columbia, and move the development teams and related game franchises to its studio in Burnaby, British Columbia. In total, the company plans to shut or consolidate at least nine studio and publishing locations. It also plans to narrow its product portfolio of games to focus on titles with higher profit margins. However, it said it would continue to invest in new games, as well as games for mobile devices and online play.
EA said the restructuring is expected to yield savings of approximately $120m in annual costs. It expects to take a restructuring charge of $55m to $65m over the next several quarters.
Earlier this month the company updated its fiscal 2009 outlook and warned that net revenue and EPS would be below the financial guidance announced in October after lower than expected sales across North America and Europe.