Electronic Arts plans to cut its work force by 17 percent as it tries to align its business with a transforming video game industry.

The company announced the layoffs of 1,500 people just hours after it said it is paying at least $275 million to buy Playfish Inc., a maker of social online games popular on Facebook, MySpace and the iPhone. The layoffs are expected to save about $100 million a year.

"We are focusing on what works and what matters," Chief Financial Officer Eric Brown said in an interview.

Digital content makes up about 12 percent of EA's revenue. But it's growing, while industry sales from packaged video games are on the decline.

The cuts are in addition to the 1,100 jobs the company already slashed this year as part of a restructuring plan to shift focus to hit games.

On Monday, EA posted a net loss of $391 million, or $1.21 a share, in the fiscal second quarter, wider than the loss of $310 million, or 97 cents per share, a year earlier.

The company behind games such as "Madden NFL 10" and "The Beatles: Rock Band" reported net sales of $788 million in the July-September period, down 12 percent from the same time a year earlier.

These results only paint a partial picture of how EA performed during the quarter. When counting deferred revenue from packaged games with online components and games that are completely digital, EA reported adjusted earnings of $19 million, or 6 cents per share. That is up from an adjusted loss of $20 million a year earlier, and it compares with average analyst estimates of 7 cents per share.

Adjusted revenue climbed 2 percent to $1.15 billion, inching past analyst estimates as polled by Thomson Reuters.

For the full fiscal year, EA expects to report a net loss between $1.20 and $2.05 per share. It is forecasting net sales in the range of $3.6 billion and $3.9 billion. Continued...