Electronic Arts shares dive after 4Q forecast

(AP) — Shares of Electronic Arts Inc. tumbled Tuesday after the video game maker offered a disappointing forecast for the quarter.

The stock was down $1.68, or 9.6 percent, to $15.81 in afternoon trading.

EA reported fiscal third-quarter results after the market close Monday that came in roughly in line with expectations.

But for this quarter which ends in March, the company said it expects a profit of 2 cents to 6 cents per share excluding unusual items, and revenue of $800 million to $850 million.

The average forecast from analysts surveyed by Thomson Reuters called for earnings of 13 cents per share on sales of $851 million. The estimates typically exclude one-time items.

The forecast came as a surprise because the company should see results from several big-name titles during the quarter, including "Mass Effect 2" and "Dante's Inferno."

Some analysts remained upbeat, however. Todd Mitchell, of Kaufman Bros., said in a note to clients that his checks suggest "management has set the bar based on what looks to be a worse-case scenario." He reiterated a "Buy" rating on shares.

BMO Capital Markets analyst Edward Williams kept an "Outperform" rating on the stock.

He said the company is still struggling with high development costs and poor sales of video games at retail stores. But he added that EA is taking a growing share of the market and the quality of its games is improving, which should help expand profit margins.