GAAP net revenue for the quarter, which includes the impact of deferred net revenue adjustments, was $788 million as compared with $894 million for the prior year. During the quarter, EA had a net revenue deferral of $359 million related to certain online-enabled packaged goods and digital content as compared with $232 million in the second quarter of the prior year.

Non-GAAP net revenue for the quarter was a record $1.147 billion, up 2 percent as compared with $1.126 billion for the prior year. Revenues were above street expectations. Sales were driven by the launches of FIFA 10, Madden NFL 10, The Beatles™: Rock Band, Need for Speed SHIFT and NCAA Football 10.

GAAP net loss for the quarter, including the impact of deferred net revenue, was $391 million as compared with a net loss of $310 million for the prior year. GAAP diluted loss per share was $1.21 as compared with GAAP diluted loss per share of $0.97 for the prior year.

Non-GAAP net income was $19 million as compared with a non-GAAP net loss of $20 million a year ago. Non-GAAP diluted earnings per share was $0.06 as compared with a non-GAAP diluted loss per share of $0.06 for the prior year.

“EA is performing well, with quality, sales and segment share up so far this year,” said John Riccitiello, Chief Executive Officer. “We are making tough calls to cut cost in targeted areas and investing more in our biggest games and digital businesses.”

“We met our second quarter expectations and delivered a record quarter for revenue,” said Eric Brown, Chief Financial Officer. “Today we are announcing a significant cut in our operating expenses and the acquisition of a leader in social games, Playfish.”

EA has announced that it has acquired Playfish Limited, a leading social games company, for approximately $275 million in cash and approximately $25 million in equity retention arrangements. In addition, the sellers are entitled to up to an additional $100 million in consideration upon the achievement of certain performance milestones. The acquisition accelerates EA’s growth in social entertainment and strengthens its focus on the transition to digital and social gaming.

Playfish will operate within EA Interactive, a division of EA focused on the web and wireless space. Playfish’s industry-leading talent and critically acclaimed games join EA to capture the exciting opportunities for social gaming and networking across a mass-market audience.

EA has announced a plan to narrow its product portfolio to provide greater focus on titles with higher margin opportunities.

This action will result in the closure of several facilities and a headcount reduction of approximately 1,500 positions, of which 1,300 are included in a restructuring plan. The majority of these actions will be completed by March 31, 2010. This plan will result in annual cost savings of at least $100 million and restructuring charges of $130 to $150 million.

EA remains committed to delivering high quality games for consumers and leading the industry in the growing digital direct gaming sector.

Highlights (comparisons are to the quarter ended September 30, 2008)

• EA was the #1 publisher in North America and Europe fiscal year to date, with 21% segment share – up four points. EA had four of the top-ten games in both North America and Europe.
• Eight EA titles launched this quarter with a Metacritic rating of 80 or above, including: NHL® 10, The Beatles: Rock Band, FIFA 10, Battlefield 1943™, Madden NFL 10, NCAA Football 10, Dead Space™ Extraction, and Need for Speed SHIFT. Calendar year-to-date, EA has 17 titles rated at 80 or above.
• FIFA 10, with a Metacritic rating of 91 on the Xbox 360® and PlayStation®3, was EA’s strongest European title launch in its history – selling 4.5 million copies in week one.
• Madden NFL 10 was the #1 title in North America for the quarter, according to NPD.
• Need for Speed SHIFT, with a 22 point increase in quality as measured by Metacritic, sold over 2.5 million copies in the quarter.
• Digital non-GAAP net revenue was an all time quarter high at $138 million – up 23 percent year-over-year.
• EA recently signed five new advertising partners – Johnson & Johnson, Doritos, Apple, Pfizer and Renault -- for $7 million in incremental advertising bookings.
• EA Mobile, the world’s leading publisher of games for phones, delivered $50 million of non-GAAP net revenue in the quarter – up nine percent year-over-year. EA is the #1 publisher of games on the iPhone with seven of the top 10 games; and #1 on Verizon with eight of the top 10 games.

The following forward-looking statements, as well as those made above, reflect expectations as of November 9, 2009. Results may be materially different and are affected by many factors, including: development delays on EA’s products; competition in the industry; the health of the economy in the U.S. and abroad and the related impact on discretionary consumer spending; changes in anticipated costs; expected savings and impact on EA’s operations of the Company’s cost reduction plan; consumer demand for console hardware and the ability of the console manufacturers to produce an adequate supply of consoles to meet that demand; changes in foreign exchange rates; the financial impact of the Playfish acquisition and potential future acquisitions by EA; the popular appeal of EA’s products; EA’s effective tax rate; and other factors detailed in this release and in EA’s annual and quarterly SEC filings.

Fiscal Year Expectations – Ending March 31, 2010

• GAAP net revenue is expected to be between $3.6 and $3.9 billion.
• Non-GAAP net revenue is expected to be approximately $4.2 to $4.4 billion.
• GAAP diluted loss per share is expected to be between $1.20 and $2.05.
• Non-GAAP diluted earnings per share is expected to be between $0.70 and $1.00 and EA expects to be profitable in both Q3 and Q4.
• For purposes of calculating fiscal year 2010 GAAP loss per share, the Company estimates a share count of 324 million and for non-GAAP EPS, the Company estimates a share count of 326 million.
• Expected non-GAAP net income excludes the following items from expected GAAP net income:

• $500 to $600 million for the impact of the change in deferred net revenue (packaged goods and digital content);
• $170 to $175 million of estimated stock-based compensation;
• $55 million of amortization of intangible assets;
• $120 to $145 million of restructuring charges;
• $24 million of losses on strategic investments;
• $14 million loss on lease obligation; and
• ($120) to ($170) million in the difference between the Company’s GAAP and non-GAAP tax expenses.

The above fiscal 2010 expectations do not reflect the financial impact of the acquisition of Playfish Limited, which is expected to be roughly neutral to non-GAAP expectations and increase GAAP loss per share by $0.15 to $0.25, due primarily to acquisition-related tax expenses, deferred revenue adjustments, additional stock-based compensation, and amortization of intangible assets. These preliminary estimates are based on currently available information and are subject to change.