10-QPeriod: Q3 FY2025

ELECTRONIC ARTS INC. Quarterly Report for Q3 Ended Dec 31, 2024

Filed February 5, 2025For Securities:EA

Summary

Electronic Arts Inc. (EA) reported its financial results for the fiscal third quarter ending December 31, 2024. The company experienced a slight year-over-year decline in net revenue, which fell by 3% to $1.88 billion. This was primarily driven by a decrease in live services and other net revenue, down 3% to $1.28 billion, and a 3% decrease in full game net revenue to $599 million. Despite the revenue dip, gross margin improved by 3 percentage points to 75.8%, and operating income saw a modest 3% increase to $377 million. Net income for the quarter was $293 million, resulting in diluted earnings per share of $1.11. For the nine-month period ended December 31, 2024, net revenue decreased by 4% to $5.57 billion. The company continues to focus on its live services segment, which remains a significant contributor to its revenue, although it experienced a slight decline. EA also highlighted a decrease in net cash provided by operating activities, largely due to lower cash collections and higher tax payments. The company actively returned capital to shareholders through significant share repurchases, totaling $1.13 billion for the nine-month period, and paid $151 million in cash dividends.

Financial Highlights

50 data points
Beta

Revenue

$1.88B

75.8% Gross Margin

Net Income

$293.00M

15.6% Net Margin

EPS (Diluted)

$1.11

Total Assets

$13.45B

Cash & Equivalents

$2.78B

Free Cash Flow

$1.18B

Financial Statements
Beta
Revenue$1.88B
Cost of Revenue$456.00M
Gross Profit$1.43B
Operating Expenses$1.05B
Operating Income$377.00M
Interest Expense$14.00M
Net Income$293.00M
EPS (Basic)$1.12
EPS (Diluted)$1.11
Shares Outstanding (Basic)262.00M
Shares Outstanding (Diluted)265.00M

Key Highlights

  • 1Net revenue for the third quarter declined 3% year-over-year to $1.88 billion.
  • 2Live services and other net revenue decreased 3% year-over-year to $1.28 billion.
  • 3Gross margin improved to 75.8%, up from 72.8% in the prior year's quarter.
  • 4Operating income increased 3% year-over-year to $377 million.
  • 5Net income for the quarter was $293 million, with diluted EPS of $1.11.
  • 6The company repurchased approximately $1.13 billion of its common stock during the first nine months of the fiscal year.
  • 7Net cash provided by operating activities for the nine-month period decreased by 7% compared to the prior year.

Frequently Asked Questions

Electronic Arts reported total net revenue of $1.883 billion for the three months ended December 31, 2024, a decrease of 3% compared to the same period in the prior year.

Live services and other net revenue for the quarter ended December 31, 2024, was $1.284 billion, a decrease of 3% year-over-year. This segment remains a material contributor to the company's overall revenue.

As of December 31, 2024, Electronic Arts held $2.776 billion in cash and cash equivalents and $379 million in short-term investments, totaling $3.155 billion.

While net revenue saw a slight decline in the current quarter and year-to-date, the company continues to focus on its live services and digital delivery, which are expected to drive future growth. However, competitive pressures and consumer buying patterns are factors that could impact future revenue linearity. The company is also actively returning capital to shareholders through share repurchases.