01—Abstract
Summary
Summary of the 10-Q filed August 8, 2023. Cited figures are marked; the original filing is the authoritative source.
Electronic Arts Inc. (EA) reported its financial results for the first quarter of fiscal year 2024, ending June 30, 2023.
The company demonstrated solid revenue growth, with net revenue increasing by 9% year-over-year to $1.924 billiona, primarily driven by strong performance in "Live Services and other" which grew 4% to $1.481 billion, and a significant 30% increase in full game net revenue to $443 million, boosted by new releases like "Star Wars Jedi: Survivor" and strong performance from "FIFA 23". Profitability saw a notable improvement, with operating income up 23% to $542 million, and net income rising to $402 million, resulting in diluted earnings per share of $1.47.
The company also generated robust operating cash flow of $359 millionb, a substantial increase from the prior year. EA continued its commitment to returning capital to shareholders through share repurchases totaling $325 million and dividend payments of $52 million.
02—Key points
Key Highlights
- Net revenue increased 9% year-over-year to $1.924 billion.
- Live services and other net revenue grew 4% to $1.481 billion, showing continued strength in ongoing game content and subscriptions.
- Full game net revenue saw a significant increase of 30% to $443 million, driven by new releases like "Star Wars Jedi: Survivor" and strong performance from "FIFA 23".
- Operating income grew by a strong 23% year-over-year to $542 million.
- Net income reached $402 million, with diluted earnings per share of $1.47.
- Net cash provided by operating activities surged to $359 million, a 560% increase compared to the prior year's quarter.
- The company repurchased $325 million worth of its common stock and paid $52 million in cash dividends.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2024, Electronic Arts kept $0.21.
- Revenue$1.92B100.0%
- Cost of revenue−$368.0M19.1%
- Gross profit$1.56B80.9%
- Operating costs−$1.01B52.7%
- Operating income$542.0M28.2%
- Interest, other & tax−$140.0M7.3%
- Net income$402.0M20.9%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed August 8, 2023Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $1.92B$1.77B | +8.9% |
| Cost of Revenue | $368.00M$314.00M | +17.2% |
| Gross Profit | $1.56B$1.45B | +7.1% |
| Operating Expenses | $1.01B$1.01B | +0.2% |
| Operating Income | $542.00M$441.00M | +22.9% |
| Interest Expense | $15.00M$14.00M | +7.1% |
| Net Income | $402.00M$311.00M | +29.3% |
| EPS (Basic) | $1.48$1.11 | +33.3% |
| EPS (Diluted) | $1.47$1.11 | +32.4% |
| Shares Outstanding (Basic) | 272.00M279.00M | −2.5% |
| Shares Outstanding (Diluted) | 274.00M281.00M | −2.5% |
05—Questions
Frequently Asked Questions
What was Electronic Arts' revenue performance in the first quarter of fiscal year 2024?
Electronic Arts reported net revenue of $1.924 billion for the first quarter of fiscal year 2024, an increase of 9% compared to the same period in the prior year. This growth was driven by both its Live Services and other segment, which increased by 4% to $1.481 billion, and a substantial 30% increase in Full game net revenue to $443 million, largely due to new game releases and ongoing game performance.
How did Electronic Arts' profitability change in the quarter?
Profitability improved significantly. Operating income increased by 23% year-over-year to $542 million. Net income was $402 million, resulting in diluted earnings per share of $1.47. This improved profitability reflects strong revenue growth and managed operating expenses.
What is the company's cash flow situation?
Electronic Arts generated a robust $359 million in net cash provided by operating activities during the first quarter, a significant increase of 560% compared to the prior year's quarter. The company also maintained a healthy liquidity position with $2.602 billion in cash and cash equivalents and short-term investments as of June 30, 2023.
What is Electronic Arts doing with its capital regarding shareholders?
The company actively returned capital to shareholders. During the quarter, EA repurchased $325 million of its common stock and paid $52 million in cash dividends. This demonstrates a commitment to enhancing shareholder value.
06—Continue