Will Disney’s Exit From Console Games Benefit ‘Star Wars’ Partner Electronic Arts?

Disney’s decision to scrap its Infinity console game business is one of the many reasons Electronic Arts shares are soaring about 13% today: The game maker reported last night that sales of Star Wars Battlefront and Star Wars: Galaxy Of Heroes helped it to blast through analysts’ earnings expectations for the first three months of this year.

“We’ll most likely have at least one Star Wars title a year over the next three years to four years,” CFO Blake Jorgensen told analysts. “Next year we will see Star Wars Battlefront back with bigger and better worlds, because we now have the new movies to work off of, not just the historical movies that we used before.”

EA LogoEA also plans to release Star Wars games for mobile devices.

That should give it the pole position to win even more business from Disney after it unveiled last night that it took a $147 million write-down to close its console game unit — preferring instead to license titles.

Gaming “is a changing business, and we did not have enough confidence in the business in terms of it being stable enough to stay in it from a self-publishing perspective,” Disney CEO Bob Iger says.

That “creates the opportunity to outsource the game to EA,” Wedbush Securities’ Michael Pachter says. The game maker’s “existing Star Wars relationship with Disney positions the company to favorably compete for the Disney Infinity license, likely driving revenue growth of $500 million or more” in the fiscal year that ends in early 2018.

EA says that it sold more than 14 million units of the Battlefront game in the fiscal year that ended in March, and more than 15% of the people who played were “new to the EA ecosystem.”

The franchise based on the movie plus other successful titles including Madden NFL MobileFIFA, and Hockey Ultimate Team helped to lift EA’s net earnings 127.6% vs the period last year to $899 million on revenues of $1.31 billion, up 10.4%.

EA was also buoyed anticipation for Battlefield 1, due in October. The trailer generated 21 million views over four days.

“It’s our most liked trailer to date,” CEO Andrew Wilson says. “And depending on what metrics you look at from YouTube, it may be the most liked trailer ever on YouTube.”

This article was printed from https://deadline.com/2016/05/disney-exit-console-games-infinity-benefit-electronic-arts-star-wars-1201753343/