Electronic Arts Inc. (NASDAQ:ERTS) plans to cut 1,500 employees which is about 17% of their workforce. The reason for the cut is because of a loss of $391 million last quarter. EA announced the results shortly after acquiring social network gaming company Playfish.
“In a tough economy, the consumer is not showing up as consistently as we like,” stated EA CEO John Riccitiello. A big chunk of the lay-offs will be at the research and development department. Many games will be canceled and those who are working on those projects may be the ones most affected too.
EA’s mobile gaming division is growing at a rapid pace. A lot of EA games that are doing well are online too. Riccitiello said that about 35% of the gaming market is online and five years ago it was 10%.