With companies releasing financial reports for Q2 2008, the fiscal period between July and September, we begin to see that even the gaming industry is not exempt from these ailing economic times.

Following Sony's bittersweet progress report, which showed us that the Japanese electronics mogul was suffering in nearly every segment but Games, North American giant Electronic Arts has just announced that they will be laying off 600 staff members after a rather disappointing Q2.

"EA announced today a cost reduction plan, which will include the elimination of approximately six per cent of the Company's workforce. The company estimates its cost reduction plan will result in annual pre-tax cost savings of approximately $50 million," EA stated recently.

Losses had increased from $195 million to $310 million since last year.  However, the company's overall revenues went up year-on-year by 33% from $650 million to $864 million, meaning they performed better in Q2 2008 than the corresponding period of 2007.  Nevertheless, chief executive John Riccitiello has expressed concern after a drop in October.

"Considering the slow down at retail we've seen in October, we are cautious in the short term," said Riccitiello.  "Longer term, we are very bullish on the game sector overall and on EA in particular. The industry is growing double-digits on the strength of three new game consoles and increases in the number of homes with broadband internet connections.  EA is continuing to make progress against our business plan, but we have the constant imperative to keep our costs in line as we grow our revenues and improve our margins."

In addition to the lay offs, EA will also be reducing the number of hirees and close several open positions originally intended to be filled this fiscal year.

"All parts of EA have reviewed their team sizes to adjust employee numbers," added Mariam Sughayer.  "The goal is to ensure we're resourced in a way that allows us to continue to grow our revenues while at the same time keeping our costs under control and improving profitability. These changes will be announced to affected staff starting October 30."