Sponsored By

Why does EA seem apathetic to Nintendo? How have Xbox 360 and PlayStation 3 contributed to EA's revenues. Matt Matthews drills deep into the publisher's sales figures.

Matt Matthews, Blogger

July 18, 2013

6 Min Read

Next week Electronic Arts will release results from its first quarter of its current fiscal year, a period running from the first of April through the end of June. Along with those results, the company will probably provide more information on what titles it plans to release, and for what platforms, through the end of March 2014. To understand what EA has announced so far and what it is likely to say next week, it is instructive to know where it has been for the past decade. I've put together some images that I think demonstrate clearly how EA used the twin HD consoles, Microsoft's Xbox 360 and Sony's PlayStation 3, to earn higher revenue throughout the last generation and is likely to continue to do that with the Xbox One and PlayStation 4. Along the way, you will also see how Nintendo's platforms have become increasingly irrelevant to EA, and how even the revenue that EA makes on mobile platforms has surpassed the revenue it makes on Nintendo platforms. Let's start with Sony, whose PlayStation platforms were essential in the popularity of EA's sports franchises like Madden NFL and NCAA Football. (As a side note, the NCAA has announced they will not renew their contract with EA, casting some doubt on precisely how licensing will continue for any future college sports titles by EA or anyone else for that matter.) All graphs shown below represent trailing-twelve month data, meaning that the height of a curve at a given time represents the sum of the data over the twelve-month period prior to that time. Here is the data for revenue earning on PlayStation platforms starting with the year that ended on March 31, 2000, more than half a year before the launch of the PlayStation 2. Right after the launch of Madden NFL 2005, EA's annual revenues on the PlayStation 2 peaked at $1.45 billion. It would not be until the very end of 2008 (the year of Rock Band 2, Dead Space, and Mirror's Edge) that revenues on three Sony platforms – the PlayStation 2, PlayStation 3, and PlayStation Portable – would rise to nearly that same level, around $1.46 billion. Since the very end of 2008, EA has found most of its Sony-derived revenue on the PlayStation 3. During the last fiscal year the company generated $1.11 billion on the PS3, down from a peak of $1.22 billion during the previous fiscal year. Since April 1, 1999, Sony's platforms have accounted for over $15 billion of EA's revenue, or more than $1 billion per year. In November 2001, Microsoft launched its Xbox console with Electronic Arts as a top publisher on the platform. At its peak in early 2005, EA's annual revenues on the original Xbox topped $515 million, but by the end of that year Microsoft's new console had launched and EA quickly moved its focus to that more powerful system. By developing many of the same titles for the Xbox 360 and PlayStation 3 during the past seven years, Electronic Arts has managed to basically double its revenue base. Revenue on the Xbox 360 totaled $1.34 billion during the year from April 2011 to March 2012, more than $100 million higher than the peak that EA achieved on Sony's PS3 during the same period. By doubling the amount of money coming in, selling on two platforms with similar technical capabilities, EA could permit its game budgets to rise dramatically while still maintaining a realistic expectation of making a profit. That doesn't mean that every game did make a profit -- after all, it has taken nearly five years for EA to begin talking seriously about Mirror's Edge again -- but the company could at least try. Seeing the data in this way, it's clear that Microsoft more than achieved parity with the previous market leader, at least in terms of generating revenue for Electronic Arts. And now it should come as no surprise that EA has announced Titanfall only for the Xbox 360, Xbox One and PC, along with an exclusivity period for Battlefield 4 DLC. Which brings me to Nintendo, which has never been as important a contributor to EA's business as Sony, but has at times been more important than Microsoft. As the figure below shows, up until the heyday of the Wii and Nintendo DS, Nintendo's platforms never generated more than about a quarter of a billion dollars in revenue for EA. Then the Wii and the Nintendo DS both caught fire, and EA's business on those platforms saw a tremendous boost. In the space of a couple of years Nintendo's platforms went from $230 million a year in revenue for EA to $890 million, an increase of about 290 percent. At that peak, during the 12 months from October 2008 to September 2009, EA's Nintendo revenue was even higher than what the company was generating on Microsoft's Xbox 360. Today, things are much different, with EA's Nintendo revenue at a mere $85 million, a fall of 90 percent from the heights of 2009. The last time EA saw Nintendo revenue levels like this, the Nintendo 64 was essentially dead and the GameCube had not yet launched in the U.S. Regardless of the actual reasons for the current chilly relationship between Nintendo and EA, the latter can certainly say that its business hardly depends on Nintendo's platforms, and that it's finding the revenue it wants elsewhere. To see that last point a bit more starkly, let's put all that data together along with two other platforms: PC and mobile. Combined, the picture for EA's revenue over the past 14 years looks like this. As of the last fiscal year, EA's mobile revenue came up to $339 million, almost exactly four times more than what the company was getting on Nintendo platforms. The conventional wisdom that mobile and tablet gaming have replaced some traditional types of gaming is true at least for EA if no one else. And it should also be noted that the PC platform has been a bedrock source of revenue for EA for well over a decade. As the figure above shows, the PC segment has never seen the wild swings that come with the rise and fall of new consoles and handhelds. With the data above, we have a better understanding of what EA plans to do over the coming months and years. During its briefing in May of this year, the company put up the following slide in a presentation to investors. The only platforms that EA intends to target in the coming year are the HD platforms – which is code for the Xbox 360 and PlayStation 3 along with their successors launching later this year – and the PC and the tablet/phone market. There is practically no room in this outlook for traditional handhelds like Sony's PlayStation Vita or Nintendo's 3DS, and there is only a shrinking opportunity for Nintendo's late entry to the HD console space, the Wii U. When EA releases its latest figures next week, and begins talking about which platforms are key to its future, we'll now all know where they're coming from.

About the Author(s)

Matt Matthews


By day, Matt Matthews is an assistant professor of Mathematics. By night and on weekends, he writes for Gamasutra, Next Generation, LinuxGames, and on his personal blog, Curmudgeon Gamer.

Daily news, dev blogs, and stories from Game Developer straight to your inbox

You May Also Like