Electronic Arts(EA) - 2026 Q2 - Quarterly Results

Financial Performance - Net bookings for the quarter totaled $1.818 billion, down 13% year-over-year, primarily due to the extraordinary release of College Football 25 in the prior year period[4] - Net revenue for the quarter was $1.839 billion, compared to $2.025 billion in the same quarter last year, reflecting a decrease of approximately 9.2%[5] - Net income for the quarter was $137 million, down from $294 million year-over-year, resulting in diluted earnings per share of $0.54 compared to $1.11 in the prior year[5] - Total net revenue for the trailing twelve months was $7.288 billion, down from $7.409 billion in the previous year[6] - Net income for the three months ended September 30, 2025, was $137 million, a decrease of 53% compared to $294 million in the same period of 2024[21] - Total net revenue for the three months ended September 30, 2025, was $1,839 million, reflecting a 9% decline from $2,025 million year-over-year[29] - GAAP operating income decreased by 48% to $200 million for the three months ended September 30, 2025, down from $384 million in 2024[29] - Non-GAAP operating income for the same period was $400 million, a 37% decrease from $637 million in the prior year[29] - Gross profit margin for the three months ended September 30, 2025, was 76%, down from 83% in the same period of 2024[29] Cash Flow and Capital Management - Operating cash flow for the quarter was $130 million, a decrease from $234 million in the same quarter last year[5] - Cash and cash equivalents at the end of the period were $1,148 million, down from $2,197 million a year earlier, representing a 48% decline[26] - Operating cash flow for the three months ended September 30, 2025, was $130 million, a decrease from $234 million in the same period of 2024[26] - Capital expenditures for the three months ended September 30, 2025, were $43 million, compared to $50 million in the same period of 2024[26] - The company repurchased 2.3 million shares for $375 million during the quarter, totaling 17.5 million shares repurchased for $2.500 billion over the trailing twelve months[4] - The company repurchased $394 million in common stock during the three months ended September 30, 2025, an increase of 5% from $375 million in the previous year[26] Strategic Developments - EA announced a definitive agreement to be acquired by an investor consortium at an enterprise value of approximately $55 billion, subject to regulatory approvals[8] - The company will not host an earnings conference call this quarter and will no longer provide forward-looking guidance due to the pending acquisition[9] Deferred Revenue and Taxation - The change in deferred net revenue from online-enabled games was a negative $375 million for the six months ended September 30, 2025, compared to a negative $339 million in the same period of 2024[21] - A tax rate of 19% is used internally by the Company for evaluating operating performance and forecasting future periods[32] Non-GAAP Financial Measures - The Company excludes acquisition-related expenses, stock-based compensation, restructuring charges, and capital expenditures from its non-GAAP financial measures to provide clearer insights into its operating results[31] - Management believes that non-GAAP financial measures offer additional useful information for understanding the Company's core business and future outlook[31] - Investors are encouraged to review GAAP financial measures alongside non-GAAP measures for a comprehensive understanding[32]