10 Percent Staff Lay Off In EA Restructuring

The CFO of EA, in its Earnings Call Transcript, declared that the company has lay-off around 900 workers from its workforce, last month. Black Jorgensen, the vice president of the company, said that the cost reduction mission of the company will reduce the overall workforce by 10 per cent. He also added, that the restructuring plans and the resignation of its last CEO, John Riccitello has cost the company $15 million extra than the estimated figure.


The official continued with the information that the company is presently working towards achieving a 20 per cent operating margin, and the lay-offs were simply initiated by that. To reach a lower operative cost, reducing the overhead expenses of the company is the major strategy, reducing in head counts certainly has helped the company to achieve the target. He did not provide any information about the departments which were hit most badly by this steep lay off. Jorgensen also did not confirm the news that the co-publishing arm of EA, which partnered the company for production, and publishing of third-party hit games, like Brutal Legend was already shut.

The employees of the company had started to count their days in the company from the time when the last CEO, Riccitello resigned from his post accepting his responsibilities for the slumping financials of the company. With the new interim CEO Larry Probst, taking up the place, plans of restructuring the organisation were on the cards, and the lay-off has been one of the major parts of the restructuring process from the beginning. EA closed down the EA Mobile section in the month of April, which was just the beginning of the process.

During the earnings call, the label president of EA, Frank Gibeau, also spoke about the disastrous launch of the latest version of the SimCity, the $60 game, which suffered from massive server connection failure at its launch, and the buyers were not able to play the game. Will Wright, the creator at the franchisee end has already depicted this incident as an inexcusable one, but the president insisted that the company has learnt lessons from its mistake and this will not happen again.

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