Electronic Arts has officially entered a new era. Following its $55 billion acquisition by The Consortium, the publisher is no longer a publicly traded company. However, the first major change under its new ownership is already raising concerns, as EA reportedly plans to slash up to $700 million in annual costs.
The move comes just days after the acquisition closed on August 4, marking the end of EA’s 36-year run as a company listed on the NASDAQ stock exchange.
EA Faces Heavy Debt After Going Private
According to Bloomberg, the acquisition leaves EA carrying approximately $18 billion in debt. That debt reportedly creates annual interest payments of around $1.8 billion.
EA generates roughly $1.5 billion in EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) each year. While that helps offset some of the financial burden, it does not fully cover the expected interest costs.
As a result, the company has already begun identifying areas where spending can be reduced.
$700 Million in Annual Cost Reductions Planned
Bloomberg reports that EA intends to reduce annual expenses by as much as $700 million.
Of that total, approximately $170 million will come from what the company describes as “organizational efficiencies.” While the wording remains vague, these types of reductions often include restructuring, consolidation of departments, and workforce-related changes.
At the time of writing, EA has not publicly detailed which teams or projects could be affected.
Shareholders Receive $210 Per Share
The acquisition officially completed on August 4, with existing shareholders receiving $210 per share. That payout also applies to employees who owned EA stock as part of compensation packages.
The deal removes EA from public trading for the first time since the company went public 36 years ago, giving its new owners greater flexibility to make long-term decisions without quarterly earnings pressure.
A Challenging Time for the Gaming Industry
EA’s restructuring plans reflect broader challenges across the gaming industry.
Rising development costs, higher interest rates, slower post-pandemic growth, and increasing pressure to improve profitability have led many major publishers to cut expenses over the past few years. Layoffs, studio closures, and project cancellations have become increasingly common across the industry.
Whether EA’s new private ownership will allow the company to invest more aggressively in future franchises or simply focus on reducing costs remains to be seen. For now, one thing is already clear: becoming a private company has not removed the financial pressures facing one of gaming’s biggest publishers.
