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PART I
This Report contains forward-looking statements within the meaning of the Private Securities Litigation
Reform Act of 1995. All statements, other than statements of historical fact, including statements regarding
industry prospects and future results of operations or Ñnancial position, made in this Report are forward
looking. We use words such as ""anticipate'', ""believe'', ""expect'', ""intend'', ""estimate'' (and the negative of
any of these terms), ""future'' and similar expressions to help identify forward-looking statements. These
forward-looking statements are subject to business and economic risk and reÖect management's current
expectations, and involve subjects that are inherently uncertain and diÇcult to predict. Our actual results
could diÅer materially. We will not necessarily update information if any forward-looking statement later
turns out to be inaccurate. Risks and uncertainties that may aÅect our future results include, but are not
limited to, those discussed under the heading ""Risk Factors'', beginning on page 49.
Item 1: Business
Overview
Electronic Arts develops, markets, publishes and distributes interactive software games (we sometimes refer
to them as ""titles'') that are playable by consumers on the following devices:
‚ In-home video game players (such as the Sony PlayStation» 2, Microsoft Xbox» and Nintendo
GameCube
TM
) Ì we call these players ""consoles'',
‚ Personal computers (PCs),
‚ Mobile video game players (such as the PlayStation»Portable ""PSP
TM
'', Game Boy» Advance and
Nintendo DS
TM
) and cellular handsets Ì we call these ""mobility'' and
‚ Online, over the Internet and other proprietary online networks.
We refer to consoles, PCs, mobility and online collectively as ""platforms''.
We were initially incorporated in California in 1982. In September 1991, we reincorporated under the laws of
Delaware. Our principal executive oÇces are located near San Francisco, California at 209 Redwood Shores
Parkway, Redwood City, California 94065 and our telephone number is (650) 628-1500.
One of our strengths is our ability to publish interactive software games for multiple platforms. Our products
that are designed to play on consoles and mobile platforms are published under license from the manufacturers
of these platforms (for example, Sony for the PlayStation 2 and PSP, Microsoft for the Xbox and Nintendo
for the Nintendo GameCube, Game Boy Advance and Nintendo DS) and we pay a fee to these platform
manufacturers for technology and intellectual property, which enables us to publish products on their
Annual Report
platforms. We invest in the creation of software tools to more eÇciently develop games for multiple platforms.
We also make investments in facilities and equipment that allow us to create and edit video and audio
recordings that are used in our games. Since our inception, we have published games for over 45 diÅerent
platforms.
Our product development methods and organization are modeled on those used in other sectors of the
entertainment industry. Employees whom we call ""producers'' are responsible for overseeing the development
of one or more products. The interactive software games that we develop and publish are broken down into
three major categories: (1) EA studio products, (2) co-publishing products and (3) distribution products.
EA Studio Products
We develop games internally at our development and production studios located near San Francisco, Los
Angeles, Orlando (Florida), Chicago, Vancouver, Montreal, London and Tokyo. We also engage third parties
to develop games on our behalf at their own development and production studios. We publish our EA Studio
products under three major brands:
‚ EA SPORTS
TM
Ì We publish realistic sports simulation games under our EA SPORTS brand. Some
of our recent products published under the EA SPORTS brand include Madden NFL 2005
(professional football), NCAA»Football 2005 (collegiate football), Rugby 2005, FIFA Soccer 2005
3