October 30, 2018 / 8:22 PM / in 13 days

EA holiday-quarter revenue forecast misses on 'Battlefield V' delay

(Reuters) - Electronic Arts Inc (EA.O) forecast third-quarter revenue below Wall Street estimates on Tuesday, as the video-game publisher’s delayed launch of its popular “Battlefield V” game hurt the company in an already crowded holiday-season game slate.

FILE PHOTO: The Electronic Arts Inc., logo is displayed on a screen during a PlayStation 4 Pro launch event in New York City, U.S., September 7, 2016. REUTERS/Brendan McDermid/File Photo

The company’s shares were down 5 percent at $90.25 in after-market trading.

EA forecast third-quarter adjusted revenue of $1.73 billion (£1.36 billion), missing the average analysts’ estimate of $2 billion, according to Refinitiv data.

The revenue forecast was down 12 percent, compared to the same period last year, when its “Need for Speed Payback” and “The Sims 4” games were launched.

In late August, EA said it would be delaying the launch of its highly anticipated “Battlefield V” game by nearly a month to Nov. 20 which led the game publisher to cut its full-year adjusted revenue forecast to $5.20 billion from $5.55 billion.

Activision and Take-Two have already launched the latest versions of their popular game franchises, such as “Call of Duty: Black Ops 4” and “Red Dead Redemption 2”, making it a competitive holiday season for EA.

EA and other game publishers, including rivals Activision Blizzard Inc (ATVI.O) and Take Two Interactive Software Inc (TTWO.O), have also been challenged by the rise of ‘battle royale’ genre games such as “Fortnite”.

“I think the whole industry is seeing an effect from Fortnite ... we assume that it is a distraction to gameplay across the whole industry,” Chief Financial Officer Blake Jorgensen told Reuters.

Activision has also launched a ‘battle royale’ mode in its “Call of Duty: Black Ops 4” game to cash in on the increasing popularity, while EA plans to launch a similar mode for its “Battlefield V” game next year.

EA’s net income was $255 million, or 83 cents per share, in the second quarter ended Sept. 30, compared to a loss of $22 million, or 7 cents per share, a year earlier.

On an adjusted basis, revenue was $1.22 billion, beating estimates of $1.18 billion, primarily driven by its “FIFA 19” and “Madden NFL 19” games.

Reporting by Arjun Panchadar in Bengaluru; Editing by Shounak Dasgupta

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