So, it's good news! Micro-transactions business model gave EA 800$ mln and forced them to lost 3$mlrd 😂
Time to get the same by Activision for it's scam with experience.
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It's unclear if "noooooo" means "yes, I feel bad" or just a stronger "no".
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Not sure why you present this as a victory for gamers when you have a clear contradiction in the OP.
Take-Two announced earlier in the month they will do the same with every new game and according to you their shares went up 5%.
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If they're able to turn it, then no, but the lower stock value does represent a loss of confidence in the company by shareholders, and it's likely due to another looming risk, regulations. EA makes a large portion of its income from lootboxes, and most of that comes from their sports section. They do tend to fly under the radar for those of us that I guess would be considered "core" gamers, but for EA, and their shareholders, the success of the next FIFA or Madden is more important than the success of Battlefront 2. And right now, shareholders are worried that regulations will come into place in the EU or US which greatly reduces the profitability of their sports games as a result of the Battlefront 2 SNAFU. If regulations do come into play, EA is in trouble.
Half of all sales from DLC/micro-transactions/subscriptions EA earned during the (US) fiscal year of 2017 was from their sports game lootboxes. To put that into perspective, EA earned $724 million from game sales, and $650 million from these sports game lootboxes.
And this is why shareholders are worried, and why they don't have as much faith in EA anymore.
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The company value means little to stockholders, what counts is stock price growth. Investors buy share at a price, and want to sell them back at a higher price.
If their stock prices go down, their investors start to worry. This can result is high management getting a shakedown, VPs and CEO getting kicked out, or worst: shareholders rushing to sell their shares before they drop any further, causing their value to plunge even further.
8% share drop, that hurts. If someone owned 10% stock, they just lost thens of millions.
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eh. microtransactions are still highly profitable - EA just overreached with it. They'll back down from the latest attempt, but still make a huge profit on the Ultimate sports games, and they'll find other ways to put microtransactions into other games.
Keep in mind, the most profitable games in existence are (a) mobile/web games with microtransactions, and (b) multiplayer games with loot crate microtransactions.
It's good business sense to try to figure out how else to introduce microtransactions into other games - the company that figures it out is bound to make a fortune.
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I will never buy any ea game until they stop this bullshit. i let my wallet speak.
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If they wanted a free-to-play model, then they should make the game free-to-play. Then make the single player mode a DLC.
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Since noone answered you so far (because you replied to yourself).
The cake (or factory) day is your "steamgifts-birthday". I.e. the anniversary of you joining this site.
For the duration of that day a little cake (or factory) is displayed next to your name.
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for shareholder its a matter of trust, if this gets crumbled into the name EA, then will lose alot.
Also Disney got an eye on em as for the SW license.
so we gotta see how they will try to wind themselve out of it..
pss spoiler... with lies!
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Look, EA is greedy and that's really shitty. But haven't you noticed microtransactions in games of other companies too? I wonder why they only care about Battlefront II. So, don't hate only EA about microtransactions.
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It's the way how they did it.
Doing microtransactions for other skins or stuff? Thats fine.
But locking a majority of content from a fullprice AAA title? Thats bullshit. It was basically Pay-to-Play AND Pay(again)-to-Win.
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That isn't a lot. The stock just dropped to the same price that were in July. Even if they drop below 80, they end up where they started at the beginning of the year. Now if they would drop how they did at the end of 2008 that would be bad for EA (It could still happen).
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just a market correction for re-evaluating the expectation of SW Battlefront II
They're certainly not being punished for trying to figure out microtransactions
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EA has microtransactions figured out already in the form of the "Ultimate Team". And it earns them a LOT of money, so they tried to expand but it backfired.
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The risk they face now is that governments from around the world are looking into regulating lootboxes, which their Ultimate Team thing does make heavy use of. That is probably what scares shareholders more than anything else. If EA is forced to drop its very lucrative Ultimate Team lootboxes, then that will greatly hurt their profitability. They can take SW Battlefront 2 being a flop, EA is big enough for that to not have a long term negative effect on them, but they can't really take lootboxes being declared illegal or at least heavily regulated.
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I can say with confidence that I will not miss lootboxes.
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good moment to save money from spending on EA games and investing it in EA shares
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now it's probably time to buy some, they'll bounce back sooner or later
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It's a pretty bad quarter but it'll probably bounce back after another month or two. It does slow down growth though.
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i will not buy any game that contains any fking microtransaction...EA or Ubisoft so they can go to hell... xDD
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Not enough of a loss to make a difference,I'm afraid.
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muhahahaha
The sad part is that wrong measures will be taken.
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I don't care if they loose or gain money. Im just not going to buy any EA games and I suggest everyone to do the same.
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and if they release a good game? you want me to not buy it? no thankies, i find that quite silly.
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Yes, you're supposed to keep not buying anything they make until they go bankrupt. Why is this hard to grasp?
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I'm more interested on how Disney will react to all of this in the end. They are extremely protective of their brand, so I wouldn't be surprised if they broke ties with EA (regardless of the cost) if the situation continues to bring bad press.
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I would still like to buy Mirror's Edge 2 on PC. It doesn't have DLC. But, I'd prefer not to be forced to use Origin to play it. I'd like the option to purchase it for Steam. shrug
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monopolies are never good. origin is a very solid client. works absolutely fine, and some things are even better than with steam (like the support). no reason to ignore it, really.
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You do realize origin is a monopoly, right? It has a monopoly on games published by EA.
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Yep, I've no problem with Origin -- it's a good client these days. I'm careful to use the word "option" in my argument above -- as Vercinger points out, the monopoly works both ways. I bring it up in this thread for two reasons: to point out that I would still like to buy EA games, especially if they aren't trying to gouge out my wallet with extraneous DLC, and secondly that unnecessarily locking their games into a single client may be detrimental to their business in the long run (hurting investor confidence). When they pulled most of their software from Steam, they had Mass Effect 3 about to release, a juggernaut that likely added many people to their platform. A smart business decision, at the time, but not necessarily a consumer-friendly one. If they continue to lose investor confidence (honestly, I find that unlikely), I'd just like to point out a source of revenue that they may be actively missing out on. If they launch another must-have title that brings people over en masse (pun intended), my point will be rendered moot in the eyes of investors.
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How is it connected with a shitstorm on Reddit, when all IT companies lost value lately because of new Trump's economic initiatives? I think people tend to overestimate themselves and their impact on things.
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Oh really? Nvidia lost 10%, they sell GPUs like crazy bacause of bitcoin mining and still they lost 10%, two times more than EA. 6,7% in the article, but at closing it was 10%. Facebook lost 4%. Again Reddit factor, heh? No.
https://www.cnbc.com/2017/11/29/popular-tech-stocks-like-nvidia-facebook-are-getting-smoked.html
You people just see what you want to see, but the truth is: EA won't remove the microtransactions, investors know it, you know it, it is written in their plans, the whole story won't hurt them a bit, because they profit from microtransactions on 5% of the audience, and another whining 95% aren't even considered in the plan from the beginning. A day or two of whining and everything will be as usual. Get back to reality.
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You were telling only EA shares fell. You was proved wrong. Feel free to be a part of any crowd you want, but the current crowd has led you to wrong conclusions.
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And the first paragraph contradicts your wishful thinking, so you prefer to ignore it. That's what I am talking about. You made a thread with a false message based on incomplete infromation and on a hype driven by emotions. Let me guess, kids on Reddit already created a sub about how they destroy EA and save the gaming industry, right?
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That’s a mighty large chip on your shoulder, there.
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I am a simple 35 y.o. man without youth idealism but with common sense. If all companies in the red zone it means the reason is general, not local. And when I see people that actually believe that a loud scandal on forums over ONE game can hurt a huge company with a huge set of games so much that it loses 3 bln. of capitalization, it's laughable. It reminds me of classes on psychology of the crowd. The crowd is irrational and dumb.
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So common sense is to ignore the comparison between multiple game publisher and instead do a comparison between a game publisher, a hardware distributer and a social network?
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Oh really? Nvidia lost 10%, they sell GPUs like crazy bacause of bitcoin mining and still they lost 10%, two times more than EA. 6,7% in the article, but at closing it was 10%. Facebook lost 4%. Again Reddit factor, heh? No.
Then start with that and don't start with unfitting comparisons.
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Bitcoin miners use AMD Vega and they used AMD RX 580 and 570 before that, and RX 480 and 470 before that. The GTX 1060 6GB version is a good long-term mining card, but considering it is nearly impossible to find the high-end AMD cards and NVidia ones are still plentiful in stores, it is not hard to figure out what real miners actually use.
Nvidia is losing value because they keep dragging on announcing the release date and MSRP of the new architecture. But mainly because it skyrocketed ridiculously in the past year (they doubled their stock price) and the market is finally trying to balance it out.
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Did you read the article I've posted? All IT companies lose value. ALL. NASDAQ 100 is down by 2%. Some companies fell much more then EA. And the reason is expectations over Trump's intention to change taxes. No connection with Reddit shitstorm, no connection with bitcoin mining. I wrote about mining to give an example of a bad explanation, like the connection of Reddit shitstorm and EA capitalization, that exist only in the mind of a bad journalist.
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I read the article, and I do not really agree with it. Or, at all. Trump is a colossal idiot and a clown elected because he is a popular meme, but if anything, his tax reform will make all companies even more filthy rich than they are. The IT sector losing money can be attributed to the loss in faith in social platforms, natural rebalance after an unrealistically good year for them, the smaller bad news of Samsung and Apple phones having defects and threatening their quarterly forecasts and a myriad other things. Trump and his sheer idiocy is either just one factor in this or not one at all.
Plus EA losing money is because of Battlefront. When their year-end flagship title has to be truncated because even Disney, a much larger media giant called down and told them to end the SW shitstorm before the release of the film in a few weeks, it was obvious EA has to back out from everything or they lose the license entirely, and investors hate that. So yes, a lot of people agree on that EA's stock downfall right now is mostly because of SWBF2, especially since the decline started right after the media like Forbes picked it up and started doing articles on how EA managed to piss of the large chunk (maybe majority) of the game's buyers and only escalated it further.
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IT sector shares will rise even higher, they are not losing money at all, it's the prices of shares that temporary fell, they all show profits. People are buying computers and smartphones worldwide, emerging markets with billions of people are ready to add their customers to the global market, it means IT sector won't fall in near future. We see now only fluctuations, a bull trend, investors speculate when they recieve some information meaningful for the economy. As for the things journalists say when something occurs in the market, you know, they have families to feed, they need to say something specific, in hope that tomorrow it will be forgotten. I have a bad feauture: I remember to well what people say. I am bad at dates, names and numbers, but this I remember. I've been watching our financial TV Channel and I've noticed that their daily explanations is just bullshit, like ramblings of some Roman soothsayer 2k years ago. "What's hot on the news? I need to deliver an article. Oh, I remember reading on Twitter about some drama over video game... Oh, EA and Disney involved!"
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"it was obvious EA has to back out from everything or they lose the license entirely"
I don't believe that you know the terms of the license that would make this statement factual.
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Micro-transactions killing gamedev :(
EA and others going this way, I will be ignore.
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They didn't lose 3.1 billion, that's not how stock works. It's just the share price that's down.
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The article is poorly written by someone who simply wants to mislead readers, which happened in your case I guess, otherwise you wouldn't use the word "lost" . Share value goes up and down all the time and you can see this in EA's stock history in the last year. EA can't loose money if their stock goes down. Currently nobody has interest in buying those millions of shares that the shareholders own so their price goes down. Everybody's selling, nobody's buying.
EA will potentially lose money (and a lot more than 3 billion in long terms) if their microtransactions system is to be removed out of all of their games due to law regulations. Of course this won't happen as this is not how capitalism works. The same lawmakers who are currently making a lot of noise are getting a sweet % of every lootbox bought. In the end, Belgium may bother to ban video game gambling but they have a tiny market for which EA hardly care. EA are aiming at the casual PS/XBOX players in the US who simply enjoy collecting stuff including virtual football characters.
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