01—Abstract
Summary
Summary of the 10-K filed May 11, 2026. Cited figures are marked; the original filing is the authoritative source.
Electronic Arts Inc. (EA) reported total net revenue of $7.531 billiona for the fiscal year ended March 31, 2026, a slight increase of 1% year-over-year.
While live services revenue experienced a modest 1% decline, it still represented a significant 71% of total net revenue, highlighting its crucial role in EA's business model. Full game download revenue saw a healthy 16% increase, indicating a continued shift towards digital purchases. The company is in the process of being acquired by an investor consortium for $210b per share in cash, a transaction expected to close subject to regulatory approvals.
The ongoing merger adds a layer of uncertainty, impacting operational flexibility and incurring significant transaction costs, though the acquisition itself is not contingent on financing. Financially, EA reported operating income of $1.162 billionc, down 24% year-over-year, largely due to a 9% increase in operating expenses, primarily driven by higher research and development and marketing costs associated with new game releases. Net income was $887 million.
The company maintained a strong liquidity position with $2.98 billiond in cash, cash equivalents, and short-term investments, and generated robust net cash from operating activities. Despite a challenging competitive landscape and potential risks associated with the merger, EA's focus on its core live services and digital distribution continues to be a strategic imperative.
02—Key points
Key Highlights
- Total net revenue for FY2026 reached $7.531 billion, a 1% increase year-over-year, demonstrating resilience in a competitive market.
- Live services and other net revenue accounted for 71% of total net revenue ($5.383 billion), though it saw a 1% decrease year-over-year, emphasizing its continued importance to the business model.
- Full game download revenue increased by 16% to $1.708 billion, reflecting a strong consumer shift towards digital game purchases.
- The company is subject to a proposed acquisition by an investor consortium for $210 per share, with closing dependent on regulatory approvals.
- Operating income decreased by 24% to $1.162 billion, primarily due to a 9% increase in operating expenses, including significant investments in R&D and marketing.
- EA maintained a healthy financial position with $2.980 billion in cash, cash equivalents, and short-term investments.
- Net cash provided by operating activities increased by 23% to $2.553 billion, indicating strong operational cash generation.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2026, Electronic Arts kept $0.12.
- Revenue$7.53B100.0%
- Cost of revenue−$1.58B21.0%
- Gross profit$5.95B79.0%
- Operating costs−$4.79B63.5%
- Operating income$1.16B15.4%
- Interest, other & tax−$275.0M3.7%
- Net income$887.0M11.8%
Where FY2026 revenue went
$7.53B- Operating costs: $4.79B, 64% of revenue
- Cost of revenue: $1.58B, 21% of revenue
- Net income: $887.0M, 12% of revenue
- Interest, other & tax: $275.0M, 3.7% of revenue
Kept 12% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2026filed May 11, 2026Financial Statements
FY2026 against FY2025
| Line item | FY2026FY2025 | Change |
|---|---|---|
| Revenue | $7.53B$7.46B | +0.9% |
| Cost of Revenue | $1.58B$1.54B | +2.7% |
| Gross Profit | $5.95B$5.92B | +0.5% |
| Operating Expenses | $4.79B$4.40B | +8.8% |
| Operating Income | $1.16B$1.52B | −23.6% |
| Interest Expense | $53.00M$58.00M | −8.6% |
| Net Income | $887.00M$1.12B | −20.9% |
| EPS (Basic) | $3.55$4.28 | −17.1% |
| EPS (Diluted) | $3.51$4.25 | −17.4% |
| Shares Outstanding (Basic) | 250.00M262.00M | −4.6% |
| Shares Outstanding (Diluted) | 253.00M264.00M | −4.2% |
05—Questions
Frequently Asked Questions
What is the current status of the proposed acquisition of Electronic Arts by the investor consortium?
Electronic Arts has entered into a definitive agreement to be acquired by an investor consortium for $210 per share in cash. The transaction has received stockholder approval, but it is still subject to certain regulatory approvals and other closing conditions. Parties are working diligently to complete these remaining reviews.
How did Electronic Arts perform financially in fiscal year 2026, particularly regarding revenue and profitability?
For the fiscal year ended March 31, 2026, Electronic Arts reported total net revenue of $7.531 billion, a 1% increase year-over-year. Operating income decreased by 24% to $1.162 billion, impacted by a 9% rise in operating expenses, which included increased investments in research and development and marketing. Net income was $887 million.
What is the significance of 'Live Services' to EA's revenue, and how did it perform?
Live services and other net revenue represented a substantial 71% of EA's total net revenue in fiscal year 2026, amounting to $5.383 billion. While this segment experienced a slight 1% decrease year-over-year, it remains the primary driver of EA's revenue, underscoring the company's strategy of ongoing player engagement through extra content and subscriptions.
What are the key risks highlighted in the filing that could impact Electronic Arts?
Key risks include the potential disruptions if the proposed merger does not close, intense competition within the interactive entertainment market, the risk of not meeting product development schedules, rapid technological changes and the need to adapt, potential reputational damage from product quality issues or player feedback, cybersecurity threats, and the dependence on third-party console manufacturers and platforms. The merger itself also introduces risks such as impairing employee retention and restricting business opportunities during the pendency of the transaction.
06—Continue