1.    Electronic Arts

Market Share: 17% (-3)
2006 Position: 1 (UNCH)
Revenues: $3.1 billion (+5%)
Profits: $76 million (-67%)
Expectations: 0%-10% revenue growth
12 Month Range: $40-$60 <ERTS.O>
Employee Count: 7,900 (+700)
Age: 25 years
SKUs in NPD Top 100: 16 (-10)
Franchises above 80%: 9 (-2)

EA manages to keep its position as number one, thanks almost entirely to new iterations of its evergreen sports franchises and sales of catalog titles like The Sims 2 and Black. As always, it’s those sports titles that continue to keep the money rolling in for the mega-publisher, with revenues still more than double that of its nearest software-only competitor.

All was not rosy for EA in the last year, however. In what could perhaps be considered a conservative take on riding out the hardware transition, the majority of the company’s sales were made on PlayStation 2, with growing emphasis being placed on Xbox 360 – this may have caused EA to miss certain key opportunities on Nintendo DS and Wii. In addition, EA did not create a single new IP this year that cracked an 80% aggregate review score – the closest things to new properties in this review range being the futuristic Battlefield 2142 and a new sequel in the long fallow Command & Conquer series. As a result of this, EA has had to rely on revenue from a less diverse portfolio, the natural result of which is that its profits have plummeted.

While the forecast shows that next year may be difficult for EA financially, several important changes have been made that are likely to provide long-term growth for the already huge publisher. Key among these is a recent major restructuring that should put more focus on casual markets. In addition, this year should see important new properties in the form of Crysis, Army of Two and Rock Band (the game’s peripherals alone should bring in massive revenue), and EA is also releasing Wing Commander Arena, a smaller project that may be a toe in the water to see if that franchise could again become feasible. EA’s is a story that still needs several years to play out, but it will continue to be the industry leader for the foreseeable future.

Pictured:
Madden NFL 08
Army of Two
Crysis
Rock Band