Electronic Arts Inc. has cancelled plans to expand into a new video game development studio in Vancouver, citing slow holiday sales and concerns about the global economic situation.

EA began planning in late 2007 to open a studio to be housed in a 20,000-square-foot facility in the city's Yaletown district, one that would join the company's existing facilities in the Vancouver area: Burnaby, BC-based EA Canada and Vancouver-based EA Black Box.

Instead, company spokesman Colin Macrae said the company would continue to lease the space to another tenant.

The announcement comes after the company lowered its expectation for revenue and earnings for the 2009 fiscal year.

EA had in October announced plans to trim about six per cent of its global workforce, or about 600 people, but on Tuesday the company said it was increasing the number of planned layoffs.

"There are challenges across the industry and I don't think anybody is immune," said Macrae.

In addition to the two Vancouver-area studios, EA also owns another in Montreal and runs the Edmonton-based Bioware studio. EA bought Bioware earlier this year.

Macrae would not comment on the specific number of employees expected to be laid off at any of its regional locations.

Most of the more than 1,800 employees Vancouver-area employees work in EA Canada's Burnaby studio, best known for producing the popular FIFA Soccer series of games.