EA Plans $700 Million in Cuts After $18 Billion Debt Deal

EA is reportedly preparing to cut around $700 million in annual costs after completing its transition from a publicly traded company to private ownership.

The Saudi-led $55 billion acquisition of EA officially closed in early August. Bloomberg reporter Jason Schreier says the deal included approximately $18 billion in debt that EA must now help repay.

Annual interest payments could reach roughly $1.8 billion, placing immediate pressure on the publisher to reduce spending and increase predictable revenue.

EA targets major cost reductions

EA’s new owners reportedly want the company to lower annual expenses by approximately $700 million. Around $170 million could come from what the company calls organizational efficiencies.

Those savings may involve layoffs, internal restructuring, canceled projects, studio changes, or reduced investment across different business units. The $700 million target could also represent the first phase of a wider cost-cutting program.

Other technology and gaming companies have introduced similar reductions across several rounds. Microsoft’s recent XBOX restructuring included 3,200 layoffs and major studio changes.

Single-player projects could face more scrutiny

EA’s heavier debt burden could affect which games receive funding under the new ownership structure.

Former BioWare employees have already suggested that gaining approval for new projects has become more difficult. Even a major franchise such as Mass Effect may struggle to generate enough revenue alone to satisfy EA’s growing financial obligations.

Expensive, experimental, or lower-margin games could face greater scrutiny. Projects without recurring post-launch revenue may appear less attractive than established franchises with predictable sales.

EA may prioritize live-service games

The financial pressure could push EA toward multiplayer games that generate ongoing revenue through microtransactions, seasonal content, and live-service systems.

These games can produce income long after launch, making them potentially safer investments for owners focused on servicing debt and delivering consistent returns.

Traditional single-player games usually depend more heavily on initial sales. Without substantial expansions or additional monetization, they may struggle to compete internally with titles designed around continued player spending.

EA has not yet detailed how the savings plan will affect specific employees, studios, or announced games. Further restructuring, project cancellations, or asset sales could follow as the company adapts to private ownership and its new debt obligations.

Via KitGuru