Although we've yet to hear from EA, Microsoft was immediate with its response of: "We don't comment on rumors or speculation." If true, the acquisition would be ... um, wow.
Update 2: Microsoft has followed up on its earlier statement, telling Joystiq: "Microsoft has no plans to purchase Electronic Arts."
Update: Wedbush Morgan analyst Michael Pachter spoke to IndustryGamers and thinks the whole idea is rubbish. "[It makes] no sense at all," he says. "One platform exclusives would likely nullify NFL exclusivity, could kill off all sports and other licenses. EA's value on one platform is probably half its value to a multi-platform buyer (such as a media company)." A handful of other analysts weigh in, pouring even more water on the increasingly unlikely fire. We'll bring you more information as we hear it.
[Via The Street; thanks to everyone who sent this in!]