Hitting 'Em Where It Hurts, EA's Stocks Lose Over $3.1 Billion in a Month

By Suzie Ford on November 29, 2017 | News | 0

EA's stocks have taken a huge hit over the course of the last month, losing 8.5% with investors seeing $3.1 billion in stock value erased. This is in contrast to the overall S&P rising 2% and Take-Two going up 5% and Activision-Blizzard stocks rising .7%. Wall Street analysts are attributing the fall to Star Wars Battlefront II and the controversy over loot boxes and progression. Sales of the game over the Black Friday / Cyber Monday weekend were weak causing analysts to take note.

"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," Cowen's Doug Creutz wrote in a note to clients Monday. "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."

According to CNBC, this controversy and the attendant financial fallout puts EA's entire profit-generating plan at risk. Prior to the launch of SWBF2, EA had planned similar monetization strategies for its other games. With continued pressure from politicians and the irate community, Wall Street is watching EA closely.

While EA's stocks are up 39% over the course of the year, a three billion dollar loss in a single month has got to hurt.

You can read the full report over at CNBC.