The company behind the Sims

While investors wonder whether Silicon Valley will ever regain its lost magic, one tech company keeps on impressing Wall Street.

Electronic Arts, the Redwood City, Calif., gamemaker, has $2-billion in revenues and counting. And investors are optimistic: EA shares have soared 80 percent in the past 30 months, closing Friday at $56.70, down $4.65.

That's because the company, which employes 3,800 people, is the leading player in the $10.8-billion video game business. One of every four games sold in the United States bears the brand of EA or one of its wholly or partly-owned affiliates such as SquareSoft (Final Fantasy, Kingdom Hearts) and Maxis (the Sims).

EA's projected revenues of $2.3-billion this year represent a 35 percent increase over 2001. The company's largest competitor, Activision, does only half as well.

Founded in 1982, EA made its name in the late 1980s and early '90s with sports games such as Madden NFL Football series, a perennial winner that moves millions of units annually for home computers and every video game console system. Other sports series, such as NBA Live and Triple Play Baseball, and big-ticket licenses such as James Bond and the Lord of the Rings, keep consumers coming back for more.

EA released a whopping 35 games for the holidays, including new Bond and Rings titles and the Sims Online, a gaming phenomenon that could add as much as $100-million annually to the company coffers.

Interestingly, given gaming's sometimes seamy underbelly, few of EA's offerings carry a Mature (over 18) rating, meaning violent scenarios and game play are kept to a minimum, even in shoot-'em-ups such as the new Bond game Nightfire.

EA's success in the gaming genre -- plus $1-billion in annual profits -- leads chief executive Larry Probst to think the company can branch out into other entertainment media such as movies and music.

Probst is tight-lipped about specifics. But with a hit movie already spun off from one of its star franchises (Final Fantasy), several songs from this year's Madden NFL soundtrack picking up radio play and $1-billion in annual profits to fling around, EA is well-positioned to make some moves.

© 2006 • All Rights Reserved • Tampa Bay Times
490 First Avenue South • St. Petersburg, FL 33701 • 727-893-8111

Contact the Times | Privacy Policy
Standard of Accuracy | Terms, Conditions & Copyright