User2122

Video Game Stocks: Beyond the Economic Slowdown

If you look beyond the earnings for EA, you will see they're going to have major battles in the legal front in the coming months. There have been 4 class-action suits filed against the company in Federal court in California about the Digital Rights Management program, Securom, being used in their games.
If I were a stockholder, I'd be more concerned about their cash flow out to the legal sections of their company than their earnings. If they lose just one lawsuit, it could mean millions in compensation or damages. If they lose all four of them, they will be paying out millions to millions of very unhappy customers who have had significant issues with Securom, the DRM of choice for EA.