It isn't hugely surprising to hear that generative AI is a big part of the vision for EA's second coming as a private company, as reported by insiders.
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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This will be fun to watch. Maybe not for 14 500 EA employees. I kindly suggest them to leave as soon as possible.
Indeed. I think it would be in their best interest to find work elsewhere before they end up getting laid off at the most inconvenient time.
Beyond that it should be amusing to watch this company go down in flames.