The world famous company EA is one of the giants of the already giant gaming industry, and their future is pretty clear for many people. After all, they have been producing some of the most well-known games around the world. But many of these games have managed to become notorious, instead of famous, because of some of the very negative reactions by even the most hardcore fans. Their recent release, Anthem, has turned sour on them, as they were unable to fulfill the high expectations that gamers had for the game. More of the same is true about a whole load of games that have been released by EA. So what is the future of the company looking like?
The recent flops…
EA has been facing a lot of backlash because of the way they have started to embrace the loot box model over the past few years. Now, more than ever, they are including loot boxes into their games, reminding some players of a sellout trying to push their product. Many people believe this to be a pay to play model of gaming, which encourages players to keep paying money even after they have paid full price for purchasing the game.
Thanks to such an attitude, we can see a disparity between player relationship. There are some who remain loyal and try to justify EA’s actions while other condemn it, even going as far as declining to buy any more games even if they are good. This is oddly reminiscent of when KontoFX reviews were going all over the place. Most people started hating them when a regulator condemned them, but loyal customers defended it, saying that it was trustworthy and operational.
As a result, there has been many a discussion on the internet and in the real world around not buying EA games. Some investors have even been scared by this fact, believing that the price of the stocks for the company will have fallen. Strangely though, the stock value has managed to keep going up. The players are a little confused by this, but the fact of the matter is, EA has managed to establish a big enough empire to be safe, no matter how angry the people get at it.
The reason it won’t suffer
EA is one of the largest gaming companies in the world, and as a result, it has managed to solidify its positions. The gaming release portfolio of the company is wide and includes one of the most popular game types – sports. Games such as FIFA, Madden, NBA and a huge number of other popular games that see yearly releases and millions of purchases keep the company not just afloat but keep bringing in the bulk of the company’s revenue. The library of games that EA owns is huge. The development of these games does not require as much investment as the development of unique games, such as Anthem. The profit margin on each type of game is immense.
As a result, the company has a yearly supply of revenue that most companies are only able to make after years of operation. This allows the company to experiment with alternative revenue streams, such as loot boxes and DLC packages. Such experimentation by a different company might have resulted in plummeting stock value.
The stock value of EA is only going to keep going up. Over the next few months, unless the upcoming release fails, the company is not going to suffer in any way. The newest release, sea of solitude, is a relatively unknown title with indie game elements. The game might not be an immediate success, but the game is not expected to necessarily flop. Still, despite the expectations, even if the release results in bad income, the midterm outcome might only be positive for those interested in investing in the company. The stocks might drop in value for a little bit, which would make this the perfect time to think about purchasing them.
Sometime in the middle of the year, the company will be releasing some new sports games, which will be providing it with additional revenue. This will drive the company’s revenue up short term, which is why you might want to consider investing in EA stock, as the difference between the lower and the higher value will be a good increase to have in your portfolio.