this post was submitted on 30 Sep 2025

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EA's new owners are making "a huge bet" on generative AI cost-cutting to help repay a $20 billion loan, claims report (www.rockpapershotgun.com)

submitted 3 days ago by bytesonbike@discuss.online to c/games@sh.itjust.works

109 comments fedilink hide all child comments

The buyers are committing $36 billion of their own equity (briefly and inexpertly, "equity" is the value of your assets after you deduct anything you owe), including the value of the PIF's existing investments in EA. They're making up the rest of the total thanks to a $20 billion loan from JPMorgan Chase Bank. How will they manage that massive debt? According to the Financial Times, who cite unnamed insiders, they're gambling on the deployment of generative AI tools as a gigantic cost-saving measure.

"The investors are betting that AI-based cost cuts will significantly boost EA's profits in the coming years, people involved in the transaction told the Financial Times," the paper wrote (paywall) in their own coverage of the story. The FT elsewhere commented that the acquisition "is a huge bet that artificial intelligence can significantly cut EA's operating costs, allowing the equity consortium to manage a large debt load on a company that historically carried limited net debt."

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[–] Manjushri@piefed.social 18 points 3 days ago (5 children)

This has got to be some form of vulture capitalism. They will sell off all the IP and physical property, either directly or by spinning off divisions into new companies to sell off. Then sell off any other pieces of the company that they can, and finally they'll take all that income as bonuses for the new owners and leave the remains of EA with nothing but debt and no option other than to file for bankruptcy. Same thing that was done to companies like Toys-R-Us but on a larger scale.

[–] The3represents@sh.itjust.works 5 points 2 days ago

That was exactly my thought. Extract cash for the owners through massive cuts, gut the company and discard the husk. Classic leveraged buy out scheme.

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[–] Fedizen@lemmy.world 13 points 2 days ago

They're over leveraged on AI so they're trying to create markets for it, lol. Jesus christ this economy is a ponzi scheme

[–] samus12345@sh.itjust.works 12 points 2 days ago* (last edited 2 days ago)

Kind of a strange bet to make when AI use has been going down in large companies lately. Hope EA goes down as well.

[–] LadyAutumn@lemmy.blahaj.zone 9 points 2 days ago* (last edited 2 days ago) (2 children)

This is assuming people will pay money to play AI slop. These companies continue to vastly overestimate the value of AI produced content. It might be passable on like, bags of candy, maybe even occasionally passable on like free webcomics. And low quality website design. Maybe some simple cash grab mobile games that get taken down after a couple weeks due to the obvious scams.

But paid video games? Which theyre already charging absurd prices for? No. This bubble will burst and companies that continue producing actual games will come out ahead. Companies that are foolishly going all in on entirely unproven technology will crumble.

[–] djsoren19@lemmy.blahaj.zone 10 points 2 days ago (6 children)

I mean... you're talking about the company that makes billions of dollars a year on FIFA games, which are already only one step removed from AI slop. I don't seriously think EA's customer base will care; the quality of the games made by EA is already low enough that I don't believe the use of AI will move the needle. And honestly, will anyone care if it's AI updating the rosters and title to FIFA 26? I guess I feel bad for the working devs putting food on their table, but is that the job that want?

[–] LadyAutumn@lemmy.blahaj.zone 3 points 2 days ago

I really do genuinely believe that AI content is a substantial drop in quality even from minimal effort content. They'd better invest their time moving to a subscription model. And evidently, whatever theyre currently doing isnt working or they wouldnt be in this situation in the first place. So, id say, firing everyone and moving to AI based content is unlikely to save them and I would believe likely to make their situation much worse.

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[–] LustyArgonianMana@lemmy.world 4 points 2 days ago* (last edited 2 days ago)

It's probably AI videos games made by AI for AI to play. People need to do stuff like mining and growing organs, they can't do anything nice anymore like play games

[–] se7enfeet@lemmy.zip 4 points 2 days ago (1 children)

Game quality from this company will be absolute dogshit ai slop

[–] No_Eponym@lemmy.ca 1 points 1 day ago (1 children)

How many EA games require you connect to their servers just to play? How many have ToS where you need to install any updates before you play? How long before these PE folks figure out they can push updates to even older games that add data mining capacity?

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[–] stringere@sh.itjust.works 1 points 1 day ago

Maybe private equity will do to EA what they did to Toys'R'Us!

[–] Diplomjodler3@lemmy.world 9 points 3 days ago (1 children)

What a fantastic plan. Nothing could possibly go wrong.

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[–] Noise7@lemmy.world 7 points 2 days ago

Hahaha sure, let them do that.

I always hated them anyway. Good riddance.

[–] AllNewTypeFace@leminal.space 9 points 3 days ago (2 children)

Also, a bet on consumers being willing to pay AAA prices for slop

[–] djsoren19@lemmy.blahaj.zone 5 points 2 days ago

They already do, the only difference is now the slop will be made by AI instead of underpaid developers in Romania.

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[–] morphballganon@lemmy.world 1 points 1 day ago

I will gladly take the customers EA loses

[–] TwinTitans@lemmy.world 7 points 2 days ago

They’re also betting on people buying this crap. Hopefully they don’t.

[–] BuboScandiacus@mander.xyz 4 points 2 days ago

EAAI

[–] BlameTheAntifa@lemmy.world 4 points 2 days ago

Whoops.

[–] EdanGrey@sh.itjust.works 5 points 2 days ago

Well now, I'd already basically given up on EA, glad I made the right choice

[–] Fiivemacs@lemmy.ca 5 points 3 days ago (1 children)

good, let them fail more.

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[–] CyberSeeker@discuss.tchncs.de 5 points 3 days ago* (last edited 3 days ago) (2 children)

Vibe coding is one thing, but I am curious about the state of using of AI tools to reduce the cost of generating 3D assets, animations, and textures. I assume they are introducing this into Ignite and their other build tools, for more rapid prototyping if nothing else.

[–] CrabAndBroom@lemmy.ml 6 points 2 days ago

My first thought was they'll probably use it to generate endless slop assets for The Sims, since people seem to pick up whatever they put out for that.

[–] Hackworth@sh.itjust.works 4 points 2 days ago

For 3D model generation, I've played with Hunyuan3D, Tripo and Trellis. The models they make are impressive, but not production-usable. You'll spend enough time cleaning them up that you may as well make them the old fashioned way.

Most of the benefits of generative image models are already baked into Photoshop. While helpful, not something that's going to give them a competitive advantage.

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