EA's $400 Million Buy Is Profitable On $100 Million Revenues -- Analyst

Lazard Capital’s Colin Sebastian just sent out a note applauding Electronic Arts (ERTS) for its ~$400 million Playfish acquisition. He pegs Playfish’s revenues over the next 12 months at $100 million.

He writes, “social games represent a significant growth opportunity, and that Playfish is already profitable.”

Like EA, Colin isn’t worried that Playfish earns some of its revenues from lead-generation “offers.”

Despite some recent concerns over the lead generation practices on social games, it is important to note that there are a variety of options, including advertising, direct payments, pre-paid cards, and mobile. We believe the flexible payment options are a key element in generating virality, allowing for natural price segmentation and monetization.

Photo: JennyHuang

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