EA Stock Takes a Dive

Overnight, EA stock fell about 12% from $66.35 (yesterday's close) to a current price of $55 on news that EA lowered its 2005 earnings forecast from $1.82-$1.87/share to $1.62-$1.64/share. That translates to a cut in the earnings forecast from $3.275 to $3.325 billion to $3.1 to $3.125 billion. Hey, what's a few hundred million, after all? EA claims that better-than-expected sales of GTA: San Andreas, Halo 2, Half-Life 2 and World of Warcraft put a damper on their sales with CEO Larry Probst saying, ""Everybody in the industry has been surprised with World of Warcraft...There are people who haven't played games in years who are now spending 20 hours a week playing." Sounds like EA needs to learn a lesson or two from WoW.