Purchase of Electronic Arts by Arabs generates huge debt and risk of layoffs

Game producer Electronic Arts informed its shareholders that it intends to reduce annual expenses by around US$700 million, reserving a portion of US$170 million for what it internally called operational adjustments. The financial movement coincides with the conclusion of the developer’s sale for US$55 billion, transferred to a group of investors from the Middle East. Experts in the technology sector, such as reporter Jason Schreier, assess that the corporate terminology used in the document points directly to an imminent wave of employee layoffs in several of the brand’s studios.

End of an era in the stock market and the new control structure

Control of the digital entertainment giant is now in the hands of a conglomerate guided by the Public Investment Fund (PIF) of the Saudi Arabian government, in partnership with Affinity Partners, a company managed by Jared Kushner, son-in-law of the former president of the United States, Donald Trump. The signing of the contracts ends a 36-year cycle in which the developer operated publicly on the American stock exchange, consolidating the transaction as the largest leveraged acquisition ever recorded in the history of the global economy.

EA officially goes private tonight, meaning:- EA will no longer trade on the NASDAQ for the first time in 36 years- All stockholders of EA (including many employees) will receive $210/share- EA will take on $18 billion (!) in debt, putting it on the hook to pay ~$1.8 billion/year in interest

— Jason Schreier (@jasonschreier.bsky.social) 2026-08-05T00:19:52.427Z

Under the agreement signed behind the scenes, the producer’s share holders, which includes several workers from the company itself who receive share bonuses, will pocket US$210 for each share. To make the purchase viable, the Arab fund raised US$20 billion from the JPMorgan bank, an amount that adds to the US$36 billion previously guaranteed, leaving the game developer itself responsible for bearing the liabilities generated by the operation. The total volume of debt assumed by the company is expected to reach the US$18 billion mark, generating an annual interest charge of close to US$1.8 billion.

Financial pressure raises doubts about the future of studios

The producer’s financial statement shows that earnings before interest, taxes, depreciation and amortization (EBITDA) are usually in the range of US$1.5 billion per year. Even if the amount manages to cover immediate bank obligations, the cost reduction strategy indicates that the new owners seek to establish a liquidity cushion to avoid cash surges and guarantee payment to creditors.

EA's annual Ebitda is around $1.5 billion, which should be enough to service the interest payments. But the publisher has told debt investors that it will cut $700 million in annual costs including $170 million in "organizational efficiencies," per Bloomberg. In other words: mass layoffs

— Jason Schreier (@jasonschreier.bsky.social) 2026-08-05T00:34:00.106Z

Analysts who follow the technology segment have mapped the main consequences that this billion-dollar leverage can bring to the end consumer and the company’s workforce, generating a climate of uncertainty behind the scenes in the industry:

• Implementation of more aggressive monetization systems within previously released titles.
• Severe cuts to developer staff to balance payroll in the short term.
• Adoption of drastic measures to contain expenses in research and development sectors.

Christopher Dring, editorial manager of the Game Business portal, pointed out that the format of the business highlights an incisive stance on the part of buyers. The journalist recalls that private equity funds have a tradition of applying rigorous management, focused on quickly maximizing profits, which usually drastically changes the internal culture of acquired companies.

Concerns about creative freedom and the franchise catalog

Professionals who work in game creation also question the artistic directions that the developer will adopt from now on under the new tutelage. Shams Jorjani, chief executive of Arrowhead Game Studios, publicly declared his desire that the new board not force the team to work exclusively on continuations of established brands, preserving space for original ideas and maintaining a diverse catalog.

Cultural shock and the risk of censorship in renowned titles

The transfer of ownership has drawn sharp criticism because of the Saudi Arabian government’s record on basic civil rights. The Asian country applies strict rules based on Sharia law, which criminalizes consensual same-sex relationships with penalties including flogging and even death. This scenario generates immediate apprehension among consumers of franchises such as The Sims, known for allowing and celebrating gender diversity and same-sex relationships since its first versions launched in the 2000s.

The Players Alliance HQ collective started a campaign for the gaming community to pressure legislators against definitive regulatory approval of the deal. The entity argues that majority control in the hands of the Arab fund could culminate in the exclusion or total censorship of narratives that address freedom of expression and gender identity. The PIF reports directly to Crown Prince Mohammed bin Salman, an authority identified by several international human rights agencies as the person behind the murder of journalist Jamal Khashoggi.

Official position of the company’s current leadership

During the first communications about the billion-dollar sale, the producer’s executive director, Andrew Wilson, who will maintain his position on the corporate organizational chart, tried to reassure the market and fans. The executive assured that the company’s mission remains unchanged, with the focus on creating transformative experiences capable of inspiring future generations of players around the world.