EA to Cease Quarterly Guidance in Favor of Annual
Looking for guidance on EA's next quarter? You're not going to get it. "We are only providing annual guidance from this point forward," EA CFO Eric Brown said. Explanation within...
by James Brightman on Tuesday, May 13, 2008
Following the release of the publisher's fourth quarter and full-year fiscal results, Electronic Arts told investors and analysts on a conference call that the company will no longer be providing quarterly guidance. Instead, EA will only issue annual guidance numbers, but will update this guidance as necessary with each quarter.
According to Chief Financial Officer Eric Brown: "We are only providing annual guidance from this point forward. Let me explain why. As you know, our business is hit driven, seasonal and significantly impacted by the release dates for our titles. This creates uneven quarterly comparisons, both sequentially and year-over-year. If we delay a title for quality reasons from one quarter to another in the same fiscal year, while good for the long-term future of the franchise, it could have a significant impact on our quarterly performance without necessarily affecting our annual performance."
He continued, "Moving away from providing quarterly guidance reemphasizes our commitment to making operational decisions that are focused on creating long-term shareholder value. In February 2008, for the first time we provided a multi-year strategic plan for EA, highlighting our strategies to deliver revenue and profit growth over the next three years. We believe our annual results will be the best measure of our progress towards our long-term targets."
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