Day 1 under new ownership is looking as predicted.
EA plans to cut more than half a billion dollars in yearly operational costs under the new ownership. The official Press Release from Andrew Wilson on the topic of EA buyout only included, well, PR talk. Including a public message for the press and a private message for their employees - made public.
What hasn't been stated publicly and was shared only to investors is the upcoming plan to cut $700 million in annual costs. Including $170 million in "organizational efficiencies". Professional gaming reporter for Bloomberg Jason Schreier described it as another way of saying "mass layoffs".
Read Jason's full statement below:
EA officially goes private tonight, meaning:
EA will no longer trade on the NASDAQ for the first time in 36 years
All stockholders of EA (including many employees) will receive $210/share
EA will take on $18 billion (!) in debt, putting it on the hook to pay ~$1.8 billion/year in interest
EA's annual Ebitda is around $1.5 billion, which should be enough to service the interest payments. But the publisher has told debt investors that it will cut $700 million in annual costs including $170 million in "organizational efficiencies," per Bloomberg. In other words: mass layoffs
We know that EA is eager to add AI to their employees day-to-day workflow. But as suspected with the initial reports and analysis of how this buyout is going to go, there will be layoffs. If $170 million of relief in organizational efficiencies include the reported mass layoffs, we're looking at around a thousand jobs lost.
And that's included in the full $700 million annual cost sum, out of which $530 million yet have to be specified and revealed as the time moves on.
We'll keep you updated as the story further develops on the post-buyout future of Electronic Arts. EA News is the main cornerstone for all buyout news, reports and stories.
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Welcome to Sims Community!
Our community is about connecting people through open and thoughtful conversations. We want our readers to share their views and exchange ideas in a safe space.
In order to do so, we've created a simple set of rules that will improve your experience. Simply put, keep it civil.
Your post will/might be rejected if it contains:
User accounts will/might be blocked if we notice:
So, how can you be a power user?
Thanks for reading our community guidelines. Please note that we're aware of certain issues with Sign In / Log In and Create Account / Email Confirmation issues. We're working behind-the-scenes on a new Account Creation process. Thank you for your patience and remember - freedom of speech is not freedom of reach