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$3 billion in EA stock value wiped out in less than 30 days

By Cal Jeffrey · 25 replies
Nov 29, 2017
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  1. Electronic Arts’ shareholders are biting their nails as they watch the company's stock value plummet. For November, EA shares have dropped 8.5 percent. That equates to $3.1 billion in valuation wiped out in only one month. Industry analysts are blaming the plunging stock price on the debacle over Star Wars Battlefront II and its money-grubbing loot box / microtransaction system.

    Players with early access were disappointed to find that some of the game’s heroes were locked behind a very expensive paywall. Due to public outcry, EA reduced the cost of heroes substantially just before launch on November 17. However, one player calculated that it would still take thousands of hours or dollars to unlock everything. Developers were finally forced to pull microtransactions (MTX) altogether.

    The uproar has garnered so much attention that Hawaii, Belgium and other places are looking to ban loot boxes or at least have them classified as gambling. Such a classification would doom any title that uses the loot box model since it would carry an "Adults Only" rating, which most retail outlets have policies against carrying.

    The bad press also hurt sales with GamesIndustry.biz reporting that physical sales of the game were down 61 percent compared with the release of the game’s predecessor. It does not even register on the top 100 sellers list on Amazon for 2017 whereas Battlefront ranked number 37 for 2015. Granted, this only accounts for physical disc sales and not digital downloads but it still provides a fair comparison.

    CNBC reports that stock analysts have been less than impressed over the title’s performance during the Black Friday / Cyber Monday shopping weekend.

    “We were underwhelmed by sell-through for Star Wars: Battlefront II (EA) over the Black Friday weekend, which follows a controversial launch for the game,” said Drew Crum, an analyst with Stifel.

    They have clearly overdone loot boxes with Battlefront II, Need For Speed and FIFA 18, all of which have received heat recently. Because of that, EA and its shareholders are being punished. It appears that EA’s only option out of this mess is to dial back its MTX model according to Cowen analyst Doug Creutz.

    “Battlefront II is the pointy tip of the iceberg. … The biggest recent controversy has centered around EA's Star Wars Battlefront II, where early evidence suggests player anger over a mishandled loot box economy may, in fact, be impacting initial sales. We think the time has come for the industry to collectively establish a set of standards for MTX implementation, both to repair damaged player perceptions and avoid the threat of regulation.”

    Unfortunately for EA, the MTX model seems to be the crux of its business plan. Chief Financial Officer Blake Jorgensen informed investors back in February that microtransactions were responsible for $800 million in high-margin sales in 2016. He also said the company intends to expand that model into other properties such as “Battlefield” and “Battlefront.” If EA is forced to dial back this strategy, profits will dip well below initial projections, hurting share price even more.

    While this is bad news for EA, it is nowhere close to dooming the company. Even with the almost 12-point dip this month (shares are down another three percent today with three hours to go), stock prices are still up 24 percent from this time last year.

    EA won’t be going out of business anytime soon but we can probably expect to see a change in the way it has been conducting business.

    Permalink to story.

  2. BSim500

    BSim500 TS Evangelist Posts: 489   +874

    ^ As we keep saying, people can gripe in gaming forums all they want, but THIS is the only real language they (and their investors) listen to. No more "I don't agree with it... BUT... [insert lame weak-willed excuse for continuing to fuel the problem]" Boycott the lot, stand firm and don't let up until this trash is removed completely.
  3. TomSEA

    TomSEA TechSpot Chancellor Posts: 2,934   +1,247

    Glad to see consumers responding to this casino posing as a game with their wallets. Needs to happen even more.
    Reehahs, SirChocula, Burty117 and 9 others like this.
  4. pawel04

    pawel04 TS Booster Posts: 73   +89

    This is great news! By all means, as mentioned in the article, this isnt going to 'doom' the company but its now affecting something they really care about $$$, because of which I hope we will see a forced change for the better. I applaud the gaming community because for as long as I can remember, EA has been bagged on but nothing has ever happened.
    killmess, wiyosaya and Comanche like this.
  5. bolski

    bolski TS Booster Posts: 64   +74

    I agree. The tip of the ice berg. They do this with any other titles, I think it WILL hurt even more. When you start hurting stock prices, your shareholders will take notice and demand a change, which could even result in the top head cheese getting removed. So, keep it up EA. I haven't purchased a title from you in ages and never will. I refuse to spend any money on your games which are all MTX gambling facades. Keep it up. People ARE rising against the tide and sooner or later, you're going to wish you never heard of MTX.

    And why do gamers these days have to have this "instance gratification" of getting things in games that in the past, you used to work for through leveling up and playing the game? Where is the fun in getting all the powerful stuff up front (through purchasing)? It ruins the game experience. Maybe it's because many game developing companies these days churn out crap, rather than games with actual substance and playability?

    How I pine for the days of Ultima 3, 4, 5 and 7. Those were in-depth games. Same with other games during the 80's and 90's. Time to go back to those days which I do with GOG (Good 'ol Games).
  6. Comanche

    Comanche TS Enthusiast Posts: 45   +35

    I am impressed too at the gaming community , first time I see all of us agreeing and doing something about it, and to think that FIFA 18 micro transactions is even worse, and very few said anything
    Burty117, pawel04 and bolski like this.
  7. wiyosaya

    wiyosaya TS Evangelist Posts: 2,919   +1,432

    Absolutely! I won't say with which firm, but I recently had the chance to vote on what investments a fund that I have is investing in. The vote question was worded something like "Allow the fund to invest in companies that are known to NOT (emphasis mine) respect human rights." The board's recommendation was to vote "yes" to allow that policy. I could not believe that the board was recommending a Yes vote. I voted NO regardless of the board's, IMO, scummy policy.
    BSim500 likes this.
  8. amstech

    amstech IT Overlord Posts: 1,964   +1,142

    Keep it going folks.
    Stay away from everything EA.
    Last edited: Nov 29, 2017
  9. Darth Shiv

    Darth Shiv TS Evangelist Posts: 1,875   +506

    Yep totally boycotted EA titles here. I won't pay a cent for any title they release until they stop being a garbage company. That includes rushing releases with their paid pre-release access trash and the release being garbage.

    They've earn't their current rep for a reason. Consumers need to punish them enough in the pocket to let them know they won't get away with it.
    bolski and BSim500 like this.
  10. ETF Soldier

    ETF Soldier TS Evangelist Posts: 465   +138

    The ONLY microtransactions I think are acceptable in any game are for cosmetic purposes ONLY. I really like Battlefield One which was also done by Dice, all loot crates give you are skins for guns (and the occasional XP boost which is arbitrary IMO).
    Anything that gives you an advantage (ignoring negligible one, in the form of gun skins with respect to camouflage) should not be allowed.
  11. Brock Kane

    Brock Kane TS Maniac Posts: 229   +129

    Karma's a b I t c h! Hahahaha Good!
    Stark likes this.
  12. Potato Judge

    Potato Judge TS Booster Posts: 143   +65

    The force is strong in this one.
    Brock Kane likes this.
  13. roberthi

    roberthi TS Addict Posts: 326   +83

    Awe. Shame. Guess EA would have something to fall back on, but alas too many companies it purchased have been ripped apart to come save the day.
  14. roberthi

    roberthi TS Addict Posts: 326   +83

    Ironic, since the investors are the greedy bastards that push for more profit over quality games.
    JaredTheDragon, EClyde and Brock Kane like this.
  15. turismozilla

    turismozilla TS Addict Posts: 174   +55

    Having the pressure to keep share holders fat and happy is such a detriment to creativity.
    Capaill, JaredTheDragon and poohbear like this.
  16. CaptainTom

    CaptainTom TS Maniac Posts: 354   +164

    I gotta say that Battlefront II has some massively impressive graphics, and looks fun AF. But at the same time I will just not buy this game until they completely remove the current business model and progression systems plaguing it.

    Not just because I want to make an example of this game for ALL games, but specifically because I LOVE the battlefield series - and I do NOT want this BS to happen to one of my favorite series.

    I have no problem with weapon skins and minor attachments being a thing in Battlefield loot boxes - especially because I can unlock tons of them through normal gameplay. But a "card" that makes a Tie Fighter fire 40% faster and halves its turn radius?! WTF?!
    Reehahs, Stark, Cal Jeffrey and 4 others like this.
  17. EClyde

    EClyde TS Evangelist Posts: 1,527   +544

    Keep up the good work community
  18. spydercanopus

    spydercanopus TS Evangelist Posts: 857   +127

    You have no idea how much I want to play this game, but I won't because of this. All of you tards who gave in and bought the game, screw you, log out, don't come back.
    Stark, Cal Jeffrey and BSim500 like this.
  19. Puiu

    Puiu TS Evangelist Posts: 3,073   +1,494

    The game itself is just average. The campaign is short and badly written, only a few good multiplayer maps, etc. You aren't missing much. Save your money for something better.
    Stark likes this.
  20. Nobina

    Nobina TS Evangelist Posts: 1,582   +1,036

    Anything that happens to EA is well deserved. They've been pieces of **** and got away with it for far too long, all because gamers are dumb sheep and I still don't think they've gotten any better.
    BSim500 likes this.
  21. LeroN

    LeroN TS Enthusiast Posts: 62   +22

    People don't like thieves pulling money and credit cards from their pockets. Why people should pay thieves pulling money and credit cards from their pockets?
    Battlefront supposed to be one of the best online games ever made. But we got epic bullshit instead of that.
  22. Sarcasm

    Sarcasm TS Guru Posts: 375   +46

    I enjoyed the beta, but after learning more about the business model. I skipped buying this as well, and will continue to do so unless they overhaul the entire system.
  23. ghostf1re

    ghostf1re TS Maniac Posts: 285   +154

    Finally gamers are having an affect on this garbage. I'm sure the game is otherwise good, but I won't support this kind of trash that EA keeps pulling on it's customers. Having an affect on their earnings is the only way to gain any traction. Without that, EA would just keep pulling this crap. They don't care what gamers think, so long as they continue to make truck loads of money.
    BSim500 likes this.
  24. LNCPapa

    LNCPapa TS Special Forces Posts: 4,222   +485

    I agree. I've been voting against EA with my wallet for a few years now and I'm glad to see some traction setting in. In all honesty, if I see a game I want and it is launching with paid DLC I make a decision to not buy the game until a GOTY or Ultimate edition becomes available for $7.50 or less... mostly in spite. Of course it should be said there are plenty of games I want that I still don't own.
  25. Devon Walsh

    Devon Walsh TS Rookie

    I lost hope any of the known-to-be complacent gaming community coming to together to stop any corruption that has been plaguing our hobby since 2012. Warms my heart knowing that people are willing to stand up to these morons after all these years of these plebians buying Call of duty every year
    BSim500 likes this.

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