Video game publisher Electronic Arts Inc said on Thursday it will introduce the next version of its Tiger Woods console video game in June despite the star golfer's public relations nightmare and decline in popularity following his adultery scandal.
Tiger Woods PGA Tour 11 introduction will follow an online version launched on Thursday. The console game will be available on the Wii, Xbox 360, PlayStation3 and iPhone platforms, the company said.
The golf game is one of EA Sports' first online efforts. It signed a sponsor deal with Woods in 1997 and introduced 12 versions of the console game bearing his name. The latest console game had been expected for the summer and is one of the company's best-selling sports products.
We didn't form a relationship with him so that he could act as an arm's length endorser, EA Sports President Peter Moore said earlier this month. Regardless of what's happening in his personal life ... Tiger Woods is still one of the greatest athletes in history.
Signal Hill Capital analyst Todd Greenwald estimated the EA sells about 2 million units on an annual basis, generating about $80 million in net revenue. EA Sports accounts for about 30 percent of the company's overall revenue.
However, Greenwald, who has a hold rating on EA's stock, said the company has bigger worries than Woods.
They're struggling on a number of levels, he said. They're going through a restructuring, Their cost structure is way too high. They've lowered guidance four or five quarters in a row. And on top of that they don't have the hit titles, at least right now.
Last week, EA slashed its fiscal 2010 forecast on weak holiday sales in Europe and a shift to its lower-margin distribution business. The publisher of Madden NFL and Need for Speed had a tough 2009 and cut jobs amid an industry-wide sales slump.
Several companies that had sponsorship deals with Woods, including AT&T Inc and Accenture PLC, have distanced themselves from the world's No. 1 golfer since he became engulfed in allegations of multiple extramarital affairs after a minor car accident outside his Florida home November 27.
Woods, believed to be the world's wealthiest athlete, estimated to earn about $100 million a year in endorsement deals before his troubles, confessed on December 11 to infidelity. He announced he would take an indefinite break from golf to save his marriage to Swedish wife Elin Nordegren.
Also on Thursday, athletic apparel and footwear maker Nike Inc, which has said it was standing by Woods, acknowledged the golf star's absence would hurt its golf business, which in the past was centered on Woods.
Certainly, we don't take the most successful player of this era and subtract it and don't expect a short term impact, Nike Brand President Charlie Denson said in an interview.
However, Denson, speaking in South Africa ahead of the Soccer World Cup in June, said the company's golf business was not built around Woods alone.
After the initial free preview, EA said its online Tiger game will be offered through a subscription in early 2010. Since May, the company's EA Sports unit has invited players to use a test version of the game.
(Reporting by Ben Klayman, additional reporting by Marius Bosch and Serena Chaudhry in Johannesburg; Editing by Derek Caney)