Summary
Electronic Arts Inc. (EA) reported a decrease in net revenue for the first quarter of fiscal year 2025, with net revenue reaching $1.66 billion, a 14% decline compared to the same period last year. This was primarily driven by lower full game sales, down 44%, impacted by the absence of a major title release like Star Wars Jedi: Survivor from the prior year. Live services and other revenue, which forms the larger portion of EA's revenue, saw a more modest 5% decrease, indicating continued resilience in its recurring revenue streams. Despite the revenue dip, gross margin improved to 84.2%, reflecting a more favorable revenue mix and cost efficiencies. However, operating expenses increased slightly, leading to a significant 33% decrease in operating income and a 30% drop in net income to $280 million. The company continues to actively manage its capital structure, repurchasing $375 million of stock and paying $50 million in dividends during the quarter. Cash and cash equivalents decreased to $2.4 billion, impacted by these capital returns and lower operating cash flow, which was down 67% year-over-year.
Financial Highlights
49 data points| Revenue | $1.66B |
| Cost of Revenue | $263.00M |
| Gross Profit | $1.40B |
| Operating Expenses | $1.03B |
| Operating Income | $364.00M |
| Interest Expense | $14.00M |
| Net Income | $280.00M |
| EPS (Basic) | $1.05 |
| EPS (Diluted) | $1.04 |
| Shares Outstanding (Basic) | 266.00M |
| Shares Outstanding (Diluted) | 268.00M |
Key Highlights
- 1Net revenue decreased by 14% year-over-year to $1.66 billion, primarily due to a significant drop in full game sales.
- 2Live services and other revenue showed greater resilience, declining by a more modest 5% to $1.41 billion, highlighting the strength of recurring revenue streams.
- 3Gross margin improved by 3 percentage points to 84.2%, indicating better cost management or a more favorable revenue mix.
- 4Operating income saw a substantial decrease of 33% to $364 million, while net income fell 30% to $280 million.
- 5Net cash provided by operating activities significantly decreased by 67% to $120 million, reflecting lower cash collections and the impact of capital allocation.
- 6The company repurchased $375 million of its common stock and paid $50 million in dividends, returning capital to shareholders.
- 7Cash and cash equivalents and short-term investments decreased by $496 million to $2.77 billion, primarily due to capital returns and lower operating cash flow.