NEW YORK (AP) - Electronic Arts said Monday its loss widened in the latest quarter in what's been a difficult year for the company and the broader video game industry.

The company behind games such as "Madden NFL 10" also said Monday it is laying off 1,500 employees, or about 17 percent, to focus on games that have higher profit margins.

The fiscal second quarter's net loss was $391 million, or $1.21 a share, 26 percent wider than the loss from a year earlier.

Net sales fell 12 percent to $788 million in the July-September period. But sales including deferred revenue from online games grew 2 percent to $1.15 billion, inching past Wall Street's expectations.

Electronic Arts Inc., which is based in Redwood City, Calif., said it expects to report a net loss for the full fiscal year.

The video game industry has had a tough time for much of this year after capping 2008 with record retail sales. The recession has forced people to cut back on shopping, and the relative lack of big hits compared with last year has made year-over-year comparisons difficult.

But there are some bright spots. Last week, EA rival Activision Blizzard Inc. posted better-than-expected results for the third quarter and reaffirmed its outlook for the year amid high hopes for its upcoming "Call of Duty" game, which launches Tuesday and could break entertainment records when it comes to how much cash it can make in a week.

And earlier Monday, EA announced it has bought Playfish Inc., a maker of social online games such as "Pet Society," for $275 million in cash.

With the acquisition of the two-year-old startup, EA is diving further into the lucrative world of social online games, which tens of millions of people play on Facebook, MySpace, the iPhone and other platforms.