Financial Performance - Total net revenue for the fiscal quarter ended December 31, 2024, was $1,883 million, down 3% year-over-year[118] - Live services and other net revenue was $1,284 million, also down 3% year-over-year[118] - Net income was $293 million with diluted earnings per share of $1.11[118] - Net bookings for the three months ended December 31, 2024, were $2,215 million, a decrease of $151 million, or 6% year-over-year[124] - Digital full game downloads generated net revenue of $1,343 million, up from $1,262 million in 2023[116] - The gross margin increased to 75.8%, up 3 percentage points year-over-year[118] - Net revenue for the three months ended December 31, 2024 was $1,883 million, a decrease of $62 million compared to the same period in 2023[149] - Full game net revenue for the nine months ended December 31, 2024 was $1,565 million, down $117 million or 7% year-over-year[158] - Live services and other net revenue for the nine months ended December 31, 2024 was $4,003 million, a decrease of $98 million or 2% compared to the same period in 2023[159] Revenue Breakdown - Live services net revenue attributable to extra content was $4,379 million for the trailing twelve months ended December 31, 2024[114] - Full game downloads generated $446 million in revenue, an increase of 3% from $431 million in the prior year[150] - Packaged goods revenue decreased by 18%, from $187 million in 2023 to $153 million in 2024[150] - Live services and other revenue decreased by 3%, from $1,327 million in 2023 to $1,284 million in 2024[150] - The decrease in net revenue was primarily driven by a $232 million decline in extra content sales for Apex Legends and other titles[149] - A $170 million increase in revenue was noted from American football franchises, particularly from EA SPORTS College Football 25 and Dragon Age: The Veilguard[149] Expenses and Costs - Cost of revenue for the three months ended December 31, 2024 was $456 million, a decrease of $73 million compared to $529 million in the same period in 2023[161] - Research and development expenses for the three months ended December 31, 2024 were $606 million, an increase of $22 million or 4% year-over-year[168] - Marketing and sales expenses for the three months ended December 31, 2024 decreased by $25 million or 9% compared to the same period in 2023[170] - General and administrative expenses for the three months ended December 31, 2024 were $176 million, an increase of $6 million or 4% year-over-year[173] Cash Flow and Liquidity - As of December 31, 2024, cash and cash equivalents decreased by $124 million to $2,776 million, while total liquidity decreased to $3,155 million, representing 23% of total assets[178] - Net cash provided by operating activities decreased by $205 million to $1,530 million for the nine months ended December 31, 2024, primarily due to lower cash collections and higher tax payments[179] - Net cash used in investing activities increased by $19 million to $177 million, driven by an $84 million decrease in proceeds from short-term investments and a $19 million increase in capital expenditures[180] - Net cash used in financing activities increased by $188 million to $1,452 million, primarily due to a $158 million increase in common stock repurchases and excise tax payments[181] - During the nine months ended December 31, 2024, the company returned $1,276 million to stockholders, repurchasing 7.9 million shares for approximately $1,125 million[187] Strategic Initiatives - The restructuring plan approved in February 2024 aims to align the portfolio and resources with strategic priorities, expected to be completed by March 31, 2025[122] - The transition to the EA SPORTS FC brand is expected to expand global football experiences and engage more fans[119] Market Risks - The company is exposed to significant market risks, including foreign currency exchange rates, interest rates, and market prices, which have experienced notable volatility[194] - As of December 31, 2024, a hypothetical adverse foreign currency exchange rate movement of 10% could result in potential declines of $194 million in cash flow hedging and $155 million in balance sheet hedging[199] - A hypothetical 150 basis point increase in interest rates would lead to a $4 million, or 1%, decrease in the fair market value of the company's short-term investments as of December 31, 2024[203] - The company employs foreign currency forward contracts to hedge against foreign currency risks, with maturities generally of 18 months or less for sales and 3 months or less for balance sheet hedging[196][197] - The strengthening of the U.S. dollar negatively impacts reported international net revenue while positively affecting international operating expenses due to lower translation rates[195] Internal Controls and Compliance - There have been no changes in internal controls over financial reporting that materially affect the company's reporting as of the end of the fiscal quarter[206] - The company acknowledges inherent limitations in its disclosure controls and procedures, including the possibility of human error and resource constraints[207]

Core Insights - Electronic Arts (EA) reported a decline in earnings and revenues for the third quarter of fiscal 2025, with earnings per share at $2.83, down 4.4% year over year, and revenues at $2.22 billion, down 6.38% year over year due to decreased Live services and full-game revenues [1][2]. Financial Performance - The Zacks Consensus Estimate for earnings was $2.99 per share, while the revenue consensus was $2.29 billion [2]. - Net bookings for the fiscal third quarter were $2.22 billion, reflecting a 6.4% year-over-year decline, with minimal impact from foreign exchange [2]. - Full-game net bookings were $633 million, down 3% year over year, while Live services net bookings were $1.58 billion, down 8% year over year [3]. - Full-game revenues accounted for 31.8% of total revenues, decreasing 3.1% year over year to $599 million, with full-game download revenues increasing 3% to $431 million, and revenues from packaged goods plunging 18% to $187 million [4]. - Live services and other revenues, making up 68.2% of total revenues, decreased 3.2% year over year to $1.28 billion [4]. - Revenues from consoles decreased 1% year over year to $1.23 billion, while revenues from PC & Other and mobile platforms declined 7% year over year to $420 million and $296 million, respectively [5]. Operating Metrics - EA's GAAP gross profit increased 0.8% year over year to $1.43 billion, with a gross margin expansion of 300 basis points to 75.8% [6]. - Operating expenses decreased 0.1% year over year to $1.05 billion, but as a percentage of revenues, they expanded 170 basis points to 55.8% [6]. - Operating income on a GAAP basis increased 3.3% year over year to $377 million, although the operating margin contracted 130 basis points to 20% [7]. Balance Sheet and Cash Flow - As of December 31, 2024, EA had $3.16 billion in cash and short-term investments, up from $2.56 billion as of September 30, 2024 [8]. - Net cash provided by operating activities was $1.176 billion for the quarter and $2.110 billion for the trailing 12 months [8]. - EA repurchased 2.4 million shares for $375 million during the quarter, totaling 10.1 million shares for $1.45 billion over the trailing 12 months [8]. Dividend and Guidance - The company declared a quarterly cash dividend of 19 cents per share, payable on March 19, 2025, to stockholders of record as of February 26, 2025 [9]. - For the fourth quarter of fiscal 2025, EA expects GAAP revenues between $1.682 billion and $1.832 billion, with earnings per share in the range of 65 cents to $1.00 [11]. - For fiscal 2025, EA anticipates revenues between $7.25 billion and $7.40 billion, with earnings per share between $3.9 and $4.25 [11].

分组1 - Electronic Arts (EA) reported quarterly earnings of $2.83 per share, missing the Zacks Consensus Estimate of $2.99 per share, and down from $2.96 per share a year ago, representing an earnings surprise of -5.35% [1] - The company posted revenues of $2.22 billion for the quarter ended December 2024, missing the Zacks Consensus Estimate by 1.68%, and down from $2.37 billion year-over-year [2] - Electronic Arts shares have lost about 16% since the beginning of the year, while the S&P 500 has gained 1.9% [3] 分组2 - The current consensus EPS estimate for the coming quarter is $1.31 on revenues of $1.61 billion, and for the current fiscal year, it is $6.99 on revenues of $7.24 billion [7] - The Zacks Industry Rank indicates that the Gaming industry is currently in the top 19% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8]

Financial Reporting and Filing - Electronic Arts Inc. provided preliminary results for its third fiscal quarter ended December 31, 2024 [5] - The company updated its business outlook for the fiscal year ending March 31, 2025 [5] - A press release detailing the preliminary results and outlook was issued on January 22, 2025 [5] - The press release is attached as Exhibit 99.1 in the Form 8-K filing [7] - The information in Item 2.02 is not deemed "filed" under the Exchange Act unless specified otherwise [6] - The filing includes an Interactive Data File (Inline XBRL) as Exhibit 104 [7] - Stuart Canfield, Chief Financial Officer, signed the report on behalf of Electronic Arts Inc. [11] - The report was filed pursuant to the Securities Exchange Act of 1934 [9] Company Information - Electronic Arts Inc. is incorporated in Delaware with the IRS Employer Identification No. 94-2838567 [2] - The company's common stock is traded on the NASDAQ Global Select Market under the symbol "EA" [3]

Group 1 - The investigation by Pomerantz LLP focuses on potential securities fraud or unlawful business practices by Electronic Arts and its officers or directors [1] - On January 22, 2025, Electronic Arts revised its net bookings forecast for fiscal year 2025, lowering it to a range of $7 billion to $7.15 billion from a previous range of $7.5 billion to $7.8 billion [2] - Following the announcement of the revised outlook, Electronic Arts' stock price dropped by $23.77 per share, or 16.7%, closing at $118.58 per share on January 23, 2025 [3] Group 2 - Pomerantz LLP is recognized as a leading firm in corporate, securities, and antitrust class litigation, with a history of recovering multimillion-dollar damages for victims of securities fraud and corporate misconduct [4]

Core Insights - The upcoming earnings report from Electronic Arts (EA) is projected to show quarterly earnings of $2.99 per share, reflecting a 1% increase year-over-year, while revenues are expected to decline by 4.8% to $2.25 billion [1] - Analysts have revised the consensus EPS estimate down by 36.6% over the last 30 days, indicating a significant reevaluation of expectations [1][2] - The stock has underperformed, with a -16% return over the past month compared to the S&P 500's +2.7% [5] Revenue Composition - Analysts estimate that 'Net revenue by composition- Live services and other- Non-GAAP (Net Bookings)' will be $1.54 billion, a decrease of 10.3% from the previous year [4] - The 'Net revenue by composition- Full game- Full game downloads- Non-GAAP (Net Bookings)' is expected to reach $487.20 million, indicating a 5.2% increase year-over-year [4] - For 'Net revenue by composition- Full game- Packaged goods- Non-GAAP (Net Bookings)', the estimate is $189.88 million, reflecting a slight decline of 0.6% from the prior year [5] Overall Market Position - The estimated 'Net Bookings' for EA stands at $2.25 billion, down from $2.37 billion in the previous year [5] - EA currently holds a Zacks Rank 3 (Hold), suggesting its performance may align with the overall market in the near future [5]

Core Viewpoint - Rosen Law Firm is investigating potential securities claims on behalf of shareholders of Electronic Arts Inc. due to allegations of materially misleading business information issued by the company [1]. Group 1: Investigation Details - The investigation is prompted by a press release from EA on January 22, 2025, where the company revised its fiscal year 2025 guidance from anticipated mid-single-digit growth in live services net bookings to a projected mid-single-digit decline, primarily due to changes in Global Football [3]. - Following this announcement, EA's stock experienced a significant decline of over 16% on January 23, 2025 [3]. Group 2: Class Action Information - Shareholders who purchased EA securities may be entitled to compensation through a class action lawsuit, with no out-of-pocket fees or costs due to a contingency fee arrangement [2]. - Interested parties can join the prospective class action by submitting a form or contacting the Rosen Law Firm directly [2]. Group 3: Rosen Law Firm's Credentials - The Rosen Law Firm has a strong track record in securities class actions, having achieved the largest securities class action settlement against a Chinese company at the time and being ranked No. 1 for the number of settlements in 2017 [4]. - The firm has recovered hundreds of millions of dollars for investors, including over $438 million in 2019 alone [4].

Company Overview - Electronic Arts (EA) is scheduled to report its third-quarter fiscal 2025 results on February 4, 2025 [1] Financial Expectations - EA expects GAAP revenues of $1.88 billion for the third quarter of fiscal 2025, while the Zacks Consensus Estimate is $2.25 billion, indicating a decline of 4.79% from the previous year [2] - The anticipated earnings per share (EPS) is $1.11, with the consensus mark for fiscal third-quarter earnings at $2.99 per share, suggesting a 1.01% increase from the year-ago figure [2][3] - The earnings estimate has decreased by 12.3% over the past 30 days [3] Performance Drivers - Strong performance in sports franchises, particularly with the launch of Madden NFL 25 and College Football 25, has contributed to commercial success and cultural impact in sports entertainment [4] - The introduction of the EA SPORTS APP reflects EA's commitment to leveraging data and technology to enhance community engagement and attract new sports fans [5] - EA's focus on immersive content, storytelling, and community engagement is expected to support sustained growth [6] - The Team Builder and UGX suite enhancements are anticipated to improve customer experience and revenue growth [7] Competitive Landscape - The video game publishing industry is highly competitive, with EA facing significant competition from companies like Take-Two Interactive and Microsoft, which may impact profit margins and market share [8] Earnings Outlook - According to the Zacks model, EA currently has an Earnings ESP of -4.02% and a Zacks Rank of 3, indicating a lower likelihood of an earnings beat [9]

Core Insights - The tech industry is experiencing a significant transformation in 2025, driven by advancements in artificial intelligence (AI) and quantum computing, highlighted by the $500 billion Stargate AI project [1] - Quantum computing is projected to have a market potential of $15-20 billion from 2025 to 2030, with a broader economic impact estimated at $1 trillion within the next decade [2][3] - AI is expected to contribute up to $4.4 trillion annually to the global economy, indicating a strong synergy between AI and quantum computing [2] Company Developments - Scope Technologies Corp. has appointed Ted Carefoot as Vice President of Product, who brings extensive experience from major tech firms like Electronic Arts and The Walt Disney Company [3][6] - Carefoot's role will focus on advancing Scope's Quantum Security Entropy (QSE) platform, which aims to provide quantum-proof security solutions [4][8] - The company has recently completed a $1.8 million private placement and secured $1 million in debt financing from First Majestic Silver, totaling $2.8 million in new funds [5] Market Trends - Major tech companies, including Microsoft and Meta, are investing heavily in AI infrastructure, with Microsoft committing $80 billion and Meta planning to invest $65 billion [13][14] - The competitive landscape is evolving, with new entrants like DeepSeek challenging established players by demonstrating cost-effective AI solutions [13][15] - The Walt Disney Company is leveraging AI for smarter advertising, achieving an estimated 157 million monthly active users across its streaming platforms [11][12]

Core Viewpoint - Wall Street anticipates a year-over-year increase in earnings for Electronic Arts (EA) despite lower revenues, with a focus on how actual results will compare to estimates [1][3]. Earnings Expectations - EA is expected to report quarterly earnings of $3.02 per share, reflecting a +2% change year-over-year, while revenues are projected to be $2.25 billion, down 4.8% from the previous year [3]. - The consensus EPS estimate has been revised down by 30.8% over the last 30 days, indicating a bearish sentiment among analysts [4][10]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate for EA is lower than the consensus estimate, resulting in an Earnings ESP of -5.85%, complicating predictions for an earnings beat [10][11]. - A positive Earnings ESP is generally a strong indicator of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3, which increases the likelihood of a positive surprise [8]. Historical Performance - In the last reported quarter, EA exceeded the expected earnings of $2.03 per share by delivering $2.15, resulting in a surprise of +5.91% [12]. - Over the past four quarters, EA has beaten consensus EPS estimates three times [13]. Market Reaction Considerations - An earnings beat or miss alone may not dictate stock movement, as other factors can influence investor sentiment [14]. - Despite the current outlook, EA does not appear to be a compelling candidate for an earnings beat, suggesting that investors should consider additional factors before making investment decisions [16].