8-K
Electronic Arts Inc. (EA)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of report (Date of earliest event reported) May 1, 2025
ELECTRONIC ARTS INC.
(Exact Name of Registrant as Specified in Its Charter)
| Delaware | 0-17948 | 94-2838567 | |||||
|---|---|---|---|---|---|---|---|
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | 209 Redwood Shores Parkway, | Redwood City, | California | 94065-1175 | |
| --- | --- | --- | --- | ||||
| (Address of Principal Executive Offices) | (Zip Code) | (650) | 628-1500 | ||||
| --- | --- | --- | |||||
| (Registrant’s Telephone Number, Including Area Code) | (Former Name or Former Address, if Changed Since Last Report) | ||||||
| --- | Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): | ||||||
| --- | --- | --- | |||||
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||||
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||||
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||||||
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | Securities registered pursuant to Section 12(b) of the Act: | |||||
| --- | --- | --- | |||||
| Title of Each Class | Trading Symbol | Name of Each Exchange on Which Registered | |||||
| Common Stock, $0.01 par value | EA | NASDAQ Global Select Market | |||||
| Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933(17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). | |||||||
| --- | --- | ||||||
| Emerging growth company | ☐ | ||||||
| If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | ☐ |
Item 2.02 Result of Operations and Financial Condition.
On May 6, 2025, Electronic Arts Inc. ("Electronic Arts" or “EA”) issued a press release announcing its financial results for the fourth fiscal quarter and fiscal year ended March 31, 2025. A copy of the press release is attached hereto as Exhibit 99.1.
Neither the information in this Form 8-K nor the information in the press release attached hereto as Exhibit 99.1 shall be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 8.01 Other Events.
On May 1, 2025, the Audit Committee of EA, on behalf of EA’s full Board of Directors declared a cash dividend of $0.19 per share of EA's common stock. The dividend is payable on June 18, 2025 to stockholders of record as of the close of business on May 28, 2025.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description |
|---|---|
| 99.1 | Press release dated May 6, 2025, relating to Electronic Arts Inc.’s financial results for its fourth fiscal quarter and fiscal year ended March 31, 2025. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
INDEX TO EXHIBITS
| Exhibit No. | Description |
|---|---|
| 99.1 | Press release dated May 6, 2025, relating to Electronic Arts Inc.’s financial results for its fourth fiscal quarter and fiscal year ended March 31, 2025. |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ELECTRONIC ARTS INC. | |||
|---|---|---|---|
| Dated: | May 6, 2025 | By: | /s/ Stuart Canfield |
| Stuart Canfield | |||
| Chief Financial Officer |
Document
Exhibit 99.1
| Electronic Arts Reports Q4 and FY25 Results |
|---|
Strong finish to FY25 from EA SPORTS FC and Split Fiction; positions EA for growth
acceleration and a Battlefield launch in FY26
REDWOOD CITY, CA – May 6, 2025 – Electronic Arts Inc. (NASDAQ: EA) today announced preliminary financial results for its fourth quarter and fiscal year ended March 31, 2025.
“The incredible success of College Football and the enduring strength of FC drove another record year for EA SPORTS, while The Sims capped FY25 with a historic Q4,” said Andrew Wilson, CEO of Electronic Arts. “As we look to the future, we’re confident in our ability to execute across a deep pipeline — beginning this summer with the highly anticipated reveal of Battlefield, a pivotal step in delivering on our next generation of blockbuster entertainment.”
“Q4 marked a strong finish to FY25, with broad-based momentum across the portfolio positioning the business for accelerated growth,” said Stuart Canfield, CFO of Electronic Arts. “As we enter FY26, we remain focused on disciplined execution as we build toward a slate of groundbreaking upcoming releases.”
Selected Operating Highlights and Metrics
•Net bookings1 for FY25 totaled $7.355 billion.
•The EA SPORTS portfolio delivered another record net bookings year in FY25.
•EA’s American Football franchise exceeded expectations and reached over $1 billion in net bookings in FY25.
•Celebrating its 25th birthday, The Sims franchise continues its strong momentum with double digit growth in the quarter.
•In EA SPORTS FC, player monetization was up double digits, starting with the mid-January gameplay update.
•Split Fiction has sold nearly 4 million units since its hugely successful launch in March.
Selected Financial Highlights and Metrics
•Net revenue for FY25 was $7.463 billion.
•Net cash provided by operating activities was $549 million for the quarter and $2.079 billion for the fiscal year.
•EA repurchased 9.8 million shares for $1.375 billion during the quarter, bringing the total for the fiscal year to 17.6 million shares for $2.500 billion.
Dividend
EA has declared a quarterly cash dividend of $0.19 per share of the Company’s common stock. The dividend is payable on June 18, 2025 to stockholders of record as of the close of business on May 28, 2025.
Business Outlook as of May 6, 2025
Fiscal Year 2026 Expectations
Operational outlook metrics:
•Fiscal year 2026 net bookings is expected to be approximately $7.600 billion to $8.000 billion.
◦Year-over-year net bookings growth in fiscal year 2026 is expected to be driven by the EA SPORTS portfolio, The Sims, and the launches of Battlefield and skate., partially offset by approximately 5 points of weakness in catalog and Apex Legends.
•The Company expects continued growth in live services, as well as the launch of new non-annual titles in fiscal year 2027.
Financial outlook metrics:
•Net revenue is expected to be approximately $7.100 billion to $7.500 billion.
◦Change in deferred net revenue (online-enabled games) is expected to be approximately $500 million.
•GAAP operating expenses are expected to be approximately $4.470 billion to $4.570 billion.
◦Year-over-year increases in expenses are largely attributable to costs related to Battlefield marketing.
•Net income is expected to be approximately $795 million to $974 million.
•Diluted earnings per share is expected to be approximately $3.09 to $3.79.
•Operating cash flow is expected to be approximately $2.200 billion to $2.400 billion.
•The Company estimates a share count of 257 million for purposes of calculating diluted earnings per share.
•The Company intends to return at least 80% of free cash flow with stock repurchases and dividends through fiscal year 2027.
•The Company reiterates its financial margin framework through fiscal year 2027 shared at its September 2024 Investor Day.
Q1 Fiscal Year 2026 Expectations – Ending June 30, 2025
Operational outlook metric:
•Net bookings is expected to be approximately $1.175 billion to $1.275 billion.
◦Live services growth, excluding Apex Legends, is expected to be up low-single-digits year-over-year led by the EA SPORTS portfolio, offset by approximately 5 points of headwind from Apex Legends and 2 points of headwind from catalog.
Financial outlook metrics:
•Net revenue is expected to be approximately $1.550 billion to $1.650 billion.
◦Change in deferred net revenue (online-enabled games) is expected to be approximately ($375) million.
•GAAP operating expenses are expected to be approximately $1.110 billion to $1.120 billion.
◦Expenses in Q1 are impacted by continued investments in line with Q4 FY25, as well as costs associated with resource reprioritization.
•Net income is expected to be approximately $125 million to $169 million.
•Diluted earnings per share is expected to be approximately $0.49 to $0.66.
•The Company estimates a share count of 255 million for purposes of calculating diluted earnings per share.
Quarterly Financial Highlights
| Three Months Ended | ||
|---|---|---|
| March 31, | ||
| (in $ millions, except per share amounts) | 2025 | 2024 |
| Full game | 437 | 333 |
| Live services and other | 1,458 | 1,446 |
| Total net revenue | 1,895 | 1,779 |
| Net income | 254 | 182 |
| Diluted earnings per share | 0.98 | 0.67 |
| Operating cash flow | 549 | 580 |
| Value of shares repurchased | 1,375 | 325 |
| Number of shares repurchased | 9.8 | 2.3 |
| Cash dividend paid | 48 | 51 |
Fiscal Year Financial Highlights
| Twelve Months Ended | ||
|---|---|---|
| March 31, | ||
| (in $ millions, except per share amounts) | 2025 | 2024 |
| Full game | 2,002 | 2,015 |
| Live services and other | 5,461 | 5,547 |
| Total net revenue | 7,463 | 7,562 |
| Net income | 1,121 | 1,273 |
| Diluted earnings per share | 4.25 | 4.68 |
| Operating cash flow | 2,079 | 2,315 |
| Value of shares repurchased | 2,500 | 1,300 |
| Number of shares repurchased | 17.6 | 10.0 |
| Cash dividend paid | 199 | 205 |
Operating Metric
The following is a calculation of our total net bookings for the periods presented:
| Three Months Ended <br>March 31, | Twelve Months Ended<br>March 31, | |||
|---|---|---|---|---|
| (in $ millions) | 2025 | 2024 | 2025 | 2024 |
| Total net revenue | 1,895 | 1,779 | 7,463 | 7,562 |
| Change in deferred net revenue (online-enabled games) | (96) | (113) | (108) | (132) |
| Total net bookings | 1,799 | 1,666 | 7,355 | 7,430 |
Conference Call and Supporting Documents
Electronic Arts will host a conference call on May 6, 2025 at 2:00 pm PT (5:00 pm ET) to review its results for the fourth fiscal quarter and fiscal year ended March 31, 2025 and its outlook for the future. During the course of the call, Electronic Arts may disclose material developments affecting its business and/or financial performance. Listeners may access the conference call live through the following dial-in number (855) 761-5600 (domestic) or (646) 307-1097 (international), using the conference code 5939891 or via webcast at EA’s IR Website at http://ir.ea.com.
EA has posted a slide presentation with a financial model of EA’s historical results and guidance on EA’s IR Website. EA will also post the prepared remarks and a transcript from the conference call on EA’s IR Website.
A dial-in replay of the conference call will be available until May 13, 2025 at (800) 770-2030 (domestic) or (609) 800-9099 (international) using conference code 5939891. An audio webcast replay of the conference call will be available for one year on EA’s IR Website.
Forward-Looking Statements
Some statements set forth in this release, including the information relating to EA’s expectations under the heading “Business Outlook as of May 6, 2025” and other information regarding EA's expectations contain forward-looking statements that are subject to change. Statements including words such as “anticipate,” “believe,” “expect,” “intend,” “estimate,” “plan,” “predict,” “seek,” “goal,” “will,” “may,” “likely,” “should,” “could” (and the negative of any of these terms), “future” and similar expressions also identify forward-looking statements. These forward-looking statements are not guarantees of future performance and reflect management’s current expectations. Our actual results could differ materially from those discussed in the forward-looking statements.
Some of the factors which could cause the Company’s results to differ materially from its expectations include the following: sales of the Company’s products and services; the Company’s ability to develop and support digital products and services, including managing online security and privacy; outages of our products, services and technological infrastructure; the Company’s ability to manage expenses; the competition in the interactive entertainment industry; governmental regulations; the effectiveness of the Company’s sales and marketing programs; timely development and release of the Company’s products and services; the Company’s ability to realize the anticipated benefits of, and integrate, acquisitions; the consumer demand for, and the availability of an adequate supply of console hardware units; the Company’s ability to predict consumer preferences and trends; the Company’s ability to develop and implement new technology; foreign currency exchange rate fluctuations; economic and geopolitical conditions; changes in our tax rates or tax laws; and other factors described in Part II, Item 1A of Electronic Arts’ latest Quarterly Report on Form 10-Q under the heading “Risk Factors”, as well as in other documents we have filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the fiscal year ended March 31, 2024.
These forward-looking statements are current as of May 6, 2025. Electronic Arts assumes no obligation to revise or update any forward-looking statement, except as required by law. In addition, the preliminary financial results set forth in this release are estimates based on information currently available to Electronic Arts.
While Electronic Arts believes these estimates are meaningful, they could differ from the actual amounts that Electronic Arts ultimately reports in its Annual Report on Form 10-K for the fiscal year ended March 31, 2025. Electronic Arts assumes no obligation and does not intend to update these estimates prior to filing its Form 10-K for the fiscal year ended March 31, 2025.
About Electronic Arts
Electronic Arts (NASDAQ: EA) is a global leader in digital interactive entertainment. The Company develops and delivers games, content and online services for Internet-connected consoles, mobile devices and personal computers.
In fiscal year 2025, EA posted GAAP net revenue of approximately $7.5 billion. Headquartered in Redwood City, California, EA is recognized for a portfolio of critically acclaimed, high-quality brands such as EA SPORTS FC™, Battlefield™, Apex Legends™, The Sims™, EA SPORTS™ Madden NFL, EA SPORTS™ College Football, Need for Speed™, Dragon Age™, Titanfall™, Plants vs. Zombies™ and EA SPORTS F1®. More information about EA is available at www.ea.com/news.
EA, EA SPORTS, EA SPORTS FC, Battlefield, Need for Speed, Apex Legends, The Sims, Dragon Age, Titanfall, and Plants vs. Zombies are trademarks of Electronic Arts Inc. John Madden, NFL, and F1 are the property of their respective owners and used with permission.
For additional information, please contact:
| Andrew Uerkwitz | Justin Higgs |
|---|---|
| Vice President, Investor Relations | Vice President, Corporate Communications |
| 650-674-7191 | 925-502-9253 |
| auerkwitz@ea.com | jhiggs@ea.com |
1 Net bookings is defined as the net amount of products and services sold digitally or sold-in physically in the period. Net bookings is calculated by adding total net revenue to the change in deferred net revenue for online-enabled games.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | |||
|---|---|---|---|
| Unaudited Condensed Consolidated Statements of Operations | |||
| (in millions, except per share data) | |||
| Twelve Months Ended March 31, | |||
| 2024 | 2025 | 2024 | |
| Net revenue | 1,779 | 7,463 | 7,562 |
| Cost of revenue | 357 | 1,543 | 1,710 |
| Gross profit | 1,422 | 5,920 | 5,852 |
| Operating expenses: | |||
| Research and development | 638 | 2,569 | 2,420 |
| Marketing and sales | 234 | 962 | 1,019 |
| General and administrative | 185 | 745 | 691 |
| Amortization and impairment of intangibles | 72 | 67 | 142 |
| Restructuring | 59 | 57 | 62 |
| Total operating expenses | 1,188 | 4,400 | 4,334 |
| Operating income | 234 | 1,520 | 1,518 |
| Interest and other income (expense), net | 26 | 85 | 71 |
| Income before provision for income taxes | 260 | 1,605 | 1,589 |
| Provision for income taxes | 78 | 484 | 316 |
| Net income | 182 | 1,121 | 1,273 |
| Earnings per share | |||
| Basic | 0.68 | 4.28 | 4.71 |
| Diluted | 0.67 | 4.25 | 4.68 |
| Number of shares used in computation | |||
| Basic | 267 | 262 | 270 |
| Diluted | 270 | 264 | 272 |
All values are in US Dollars.
Results (in $ millions, except per share data)
The following table reports the variance of the actuals versus our guidance provided on February 4, 2025 for the three months ended March 31, 2025 plus a comparison to the actuals for the three months ended March 31, 2024.
| Three Months Ended March 31, | ||||||||
|---|---|---|---|---|---|---|---|---|
| 2025 Guidance (Mid-Point) | 2025 Actuals | 2024 Actuals | ||||||
| Variance | ||||||||
| Net revenue | ||||||||
| Net revenue | 1,757 | 138 | 1,895 | 1,779 | ||||
| GAAP-based financial data | ||||||||
| Change in deferred net revenue (online-enabled games)1 | (238) | 142 | (96) | (113) | ||||
| Cost of revenue | ||||||||
| Cost of revenue | 310 | 58 | 368 | 357 | ||||
| GAAP-based financial data | ||||||||
| Acquisition-related expenses | (10) | — | (10) | (29) | ||||
| Stock-based compensation | (4) | 1 | (3) | (2) | ||||
| Operating expenses | ||||||||
| Operating expenses | 1,117 | 15 | 1,132 | 1,188 | ||||
| GAAP-based financial data | ||||||||
| Acquisition-related expenses | (20) | 3 | (17) | (72) | ||||
| Restructuring and related charges | (7) | 3 | (4) | (61) | ||||
| Stock-based compensation | (161) | 2 | (159) | (146) | ||||
| Income before tax | ||||||||
| Income before tax | 351 | 56 | 407 | 260 | ||||
| GAAP-based financial data | ||||||||
| Acquisition-related expenses | 30 | (3) | 27 | 101 | ||||
| Change in deferred net revenue (online-enabled games)1 | (238) | 142 | (96) | (113) | ||||
| Restructuring and related charges | 7 | (3) | 4 | 61 | ||||
| Stock-based compensation | 165 | (3) | 162 | 148 | ||||
| Tax rate used for management reporting | 19 | % | 19 | % | 19 | % | ||
| Earnings per share | ||||||||
| Basic | 0.83 | 0.16 | 0.99 | 0.68 | ||||
| Diluted | 0.82 | 0.16 | 0.98 | 0.67 | ||||
| Number of shares used in computation | ||||||||
| Basic | 262 | (5) | 257 | 267 | ||||
| Diluted | 264 | (5) | 259 | 270 |
1The change in deferred net revenue (online-enabled games) in the unaudited condensed consolidated statements of cash flows does not necessarily equal the change in deferred net revenue (online-enabled games) in the unaudited condensed consolidated statements of operations primarily due to the impact of unrecognized gains/losses on cash flow hedges.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | |
|---|---|
| Unaudited Condensed Consolidated Balance Sheets | |
| (in millions) | |
| March 31, 20242 | |
| ASSETS | |
| Current assets: | |
| Cash and cash equivalents | 2,900 |
| Short-term investments | 362 |
| Receivables, net | 565 |
| Other current assets | 420 |
| Total current assets | 4,247 |
| Property and equipment, net | 578 |
| Goodwill | 5,379 |
| Acquisition-related intangibles, net | 400 |
| Deferred income taxes, net | 2,380 |
| Other assets | 436 |
| TOTAL ASSETS | 13,420 |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |
| Current liabilities: | |
| Accounts payable, accrued, and other current liabilities | 1,276 |
| Deferred net revenue (online-enabled games) | 1,814 |
| Senior notes, current, net | — |
| Total current liabilities | 3,090 |
| Senior notes, net | 1,882 |
| Income tax obligations | 497 |
| Other liabilities | 438 |
| Total liabilities | 5,907 |
| Stockholders’ equity: | |
| Common stock | 3 |
| Retained earnings | 7,582 |
| Accumulated other comprehensive loss | (72) |
| Total stockholders’ equity | 7,513 |
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | 13,420 |
All values are in US Dollars.
2Derived from audited consolidated financial statements.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | |||
|---|---|---|---|
| Unaudited Condensed Consolidated Statements of Cash Flows | |||
| (in millions) | |||
| Twelve Months Ended March 31, | |||
| 2024 | 2025 | 2024 | |
| OPERATING ACTIVITIES | |||
| Net income | 182 | 1,121 | 1,273 |
| Adjustments to reconcile net income to net cash provided by operating activities: | |||
| Depreciation, amortization, accretion and impairment | 149 | 356 | 404 |
| Stock-based compensation | 148 | 642 | 584 |
| Change in assets and liabilities | |||
| Receivables, net | 303 | (115) | 119 |
| Other assets | (38) | 40 | 148 |
| Accounts payable, accrued, and other liabilities | (53) | 190 | (208) |
| Deferred income taxes, net | (6) | (41) | 82 |
| Deferred net revenue (online-enabled games) | (105) | (114) | (87) |
| Net cash provided by operating activities | 580 | 2,079 | 2,315 |
| INVESTING ACTIVITIES | |||
| Capital expenditures | (51) | (221) | (199) |
| Proceeds from maturities and sales of short-term investments | 182 | 695 | 632 |
| Purchase of short-term investments | (180) | (437) | (640) |
| Net cash provided by (used in) investing activities | (49) | 37 | (207) |
| FINANCING ACTIVITIES | |||
| Proceeds from issuance of common stock | 34 | 78 | 77 |
| Cash dividends paid | (51) | (199) | (205) |
| Cash paid to taxing authorities for shares withheld from employees | (18) | (234) | (196) |
| Common stock repurchases and excise taxes paid | (325) | (2,508) | (1,300) |
| Net cash used in financing activities | (360) | (2,863) | (1,624) |
| Effect of foreign exchange on cash and cash equivalents | (13) | (17) | (8) |
| Change in cash and cash equivalents | 158 | (764) | 476 |
| Beginning cash and cash equivalents | 2,742 | 2,900 | 2,424 |
| Ending cash and cash equivalents | 2,900 | 2,136 | 2,900 |
All values are in US Dollars.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Unaudited Supplemental Financial Information and Business Metrics | |||||||||||
| (in millions, except per share data) | |||||||||||
| Q1 | Q2 | Q3 | Q4 | YOY % | |||||||
| FY25 | FY25 | FY25 | FY25 | Change | |||||||
| Net revenue | |||||||||||
| Net revenue | 1,660 | 2,025 | 1,883 | 1,895 | 7 | % | |||||
| GAAP-based financial data | |||||||||||
| Change in deferred net revenue (online-enabled games)1 | (398) | 54 | 332 | (96) | |||||||
| Gross profit | |||||||||||
| Gross profit | 1,397 | 1,569 | 1,427 | 1,527 | 7 | % | |||||
| Gross profit (as a % of net revenue) | % | 84 | % | 78 | % | 76 | % | 81 | % | ||
| GAAP-based financial data | |||||||||||
| Acquisition-related expenses | 10 | 10 | 10 | 10 | |||||||
| Change in deferred net revenue (online-enabled games)1 | (398) | 54 | 332 | (96) | |||||||
| Stock-based compensation | 4 | 4 | 3 | 3 | |||||||
| Operating income | |||||||||||
| Operating income | 364 | 384 | 377 | 395 | 69 | % | |||||
| Operating income (as a % of net revenue) | % | 22 | % | 19 | % | 20 | % | 21 | % | ||
| GAAP-based financial data | |||||||||||
| Acquisition-related expenses | 27 | 27 | 26 | 27 | |||||||
| Change in deferred net revenue (online-enabled games)1 | (398) | 54 | 332 | (96) | |||||||
| Restructuring and related charges | 6 | 52 | — | 4 | |||||||
| Stock-based compensation | 143 | 174 | 163 | 162 | |||||||
| Net income | |||||||||||
| Net income | 280 | 294 | 293 | 254 | 40 | % | |||||
| Net income (as a % of net revenue) | % | 17 | % | 15 | % | 16 | % | 13 | % | ||
| GAAP-based financial data | |||||||||||
| Acquisition-related expenses | 27 | 27 | 26 | 27 | |||||||
| Change in deferred net revenue (online-enabled games)1 | (398) | 54 | 332 | (96) | |||||||
| Restructuring and related charges | 6 | 52 | — | 4 | |||||||
| Stock-based compensation | 143 | 174 | 163 | 162 | |||||||
| Tax rate used for management reporting | % | 19 | % | 19 | % | 19 | % | 19 | % | ||
| Diluted earnings per share | 1.04 | 1.11 | 1.11 | 0.98 | 46 | % | |||||
| Number of shares used in computation | |||||||||||
| Basic | 266 | 264 | 262 | 257 | |||||||
| Diluted | 268 | 266 | 265 | 259 |
All values are in US Dollars.
1The change in deferred net revenue (online-enabled games) in the unaudited condensed consolidated statements of cash flows does not necessarily equal the change in deferred net revenue (online-enabled games) in the unaudited condensed consolidated statements of operations primarily due to the impact of unrecognized gains/losses on cash flow hedges.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Unaudited Supplemental Financial Information and Business Metrics | |||||||||||
| (in millions) | |||||||||||
| Q1 | Q2 | Q3 | Q4 | YOY % | |||||||
| FY25 | FY25 | FY25 | FY25 | Change | |||||||
| QUARTERLY NET REVENUE PRESENTATIONS | |||||||||||
| Net revenue by composition | |||||||||||
| Full game downloads | 190 | 475 | 446 | 367 | 38 | % | |||||
| Packaged goods | 60 | 241 | 153 | 70 | 3 | % | |||||
| Full game | 250 | 716 | 599 | 437 | 31 | % | |||||
| Live services and other | 1,410 | 1,309 | 1,284 | 1,458 | 1 | % | |||||
| Total net revenue | 1,660 | 2,025 | 1,883 | 1,895 | 7 | % | |||||
| Full game | % | 15 | % | 35 | % | 32 | % | 23 | % | ||
| Live services and other | % | 85 | % | 65 | % | 68 | % | 77 | % | ||
| Total net revenue % | % | 100 | % | 100 | % | 100 | % | 100 | % | ||
| GAAP-based financial data | |||||||||||
| Full game downloads | (47) | 70 | 25 | (27) | |||||||
| Packaged goods | (35) | 46 | 9 | (26) | |||||||
| Full game | (82) | 116 | 34 | (53) | |||||||
| Live services and other | (316) | (62) | 298 | (43) | |||||||
| Total change in deferred net revenue (online-enabled games) by composition1 | (398) | 54 | 332 | (96) | |||||||
| Net revenue by platform | |||||||||||
| Console | 1,005 | 1,374 | 1,215 | 1,182 | 13 | % | |||||
| PC & Other | 365 | 364 | 392 | 426 | 1 | % | |||||
| Mobile | 290 | 287 | 276 | 287 | (7 | %) | |||||
| Total net revenue | 1,660 | 2,025 | 1,883 | 1,895 | 7 | % | |||||
| GAAP-based financial data | |||||||||||
| Console | (328) | 108 | 275 | (86) | |||||||
| PC & Other | (70) | (37) | 33 | (11) | |||||||
| Mobile | — | (17) | 24 | 1 | |||||||
| Total change in deferred net revenue (online-enabled games) by platform1 | (398) | 54 | 332 | (96) |
All values are in US Dollars.
1The change in deferred net revenue (online-enabled games) in the unaudited condensed consolidated statements of cash flows does not necessarily equal the change in deferred net revenue (online-enabled games) in the unaudited condensed consolidated statements of operations primarily due to the impact of unrecognized gains/losses on cash flow hedges.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | ||||||
|---|---|---|---|---|---|---|
| Unaudited Supplemental Financial Information and Business Metrics | ||||||
| (in millions) | ||||||
| Q1 | Q2 | Q3 | Q4 | YOY % | ||
| FY25 | FY25 | FY25 | FY25 | Change | ||
| CASH FLOW DATA | ||||||
| Investing cash flow | (69) | (46) | (62) | 214 | ||
| Investing cash flow - TTM | (232) | (215) | (226) | 37 | 118 | % |
| Financing cash flow | (546) | (402) | (504) | (1,411) | ||
| Financing cash flow - TTM | (1,688) | (1,739) | (1,812) | (2,863) | (76 | %) |
| Operating cash flow | 120 | 234 | 1,176 | 549 | ||
| Operating cash flow - TTM | 2,076 | 2,198 | 2,110 | 2,079 | (10 | %) |
| Capital expenditures | 67 | 50 | 50 | 54 | ||
| Capital expenditures - TTM | 221 | 220 | 218 | 221 | 11 | % |
| Free cash flow3 | 53 | 184 | 1,126 | 495 | ||
| Free cash flow3 - TTM | 1,855 | 1,978 | 1,892 | 1,858 | (12 | %) |
| Common stock repurchases and excise taxes paid | 375 | 375 | 383 | 1,375 | 323 | % |
| Cash dividends paid | 50 | 51 | 50 | 48 | (6 | %) |
| DEPRECIATION | ||||||
| Depreciation expense | 51 | 51 | 51 | 51 | 2 | % |
| BALANCE SHEET DATA | ||||||
| Cash and cash equivalents | 2,400 | 2,197 | 2,776 | 2,136 | ||
| Short-term investments | 366 | 366 | 379 | 112 | ||
| Cash and cash equivalents, and short-term investments | 2,766 | 2,563 | 3,155 | 2,248 | (31 | %) |
| Receivables, net | 433 | 1,012 | 742 | 679 | 20 | % |
| STOCK-BASED COMPENSATION | ||||||
| Cost of revenue | 4 | 4 | 3 | 3 | ||
| Research and development | 101 | 122 | 119 | 115 | ||
| Marketing and sales | 12 | 16 | 14 | 14 | ||
| General and administrative | 26 | 32 | 27 | 30 | ||
| Total stock-based compensation | 143 | 174 | 163 | 162 | ||
| RESTRUCTURING AND RELATED CHARGES | ||||||
| Restructuring | 2 | 51 | 1 | 3 | ||
| Office space reductions | 4 | 1 | (1) | 1 | ||
| Total restructuring and related charges | 6 | 52 | — | 4 |
All values are in US Dollars.
3Free cash flow is defined as Operating cash flow less Capital expenditures.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | ||
|---|---|---|
| Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures | ||
| (in millions) | ||
| The following table provides a reconciliation of non-GAAP operating income and margin to their most directly comparable GAAP financial measure for the twelve months ended March 31, 2025 plus a comparison to the actuals for the twelve months ended March 31, 2024. | ||
| 2024 | YOY % Change | |
| Net revenue | 7,562 | (1%) |
| GAAP operating income | 1,518 | — |
| Acquisition-related expenses | 218 | |
| Restructuring and related charges | 64 | |
| Stock-based compensation | 584 | |
| Non-GAAP operating income | 2,384 | (2%) |
| GAAP operating margin | 20.1% | |
| Non-GAAP operating margin | 31.5% | |
| Impact from change in deferred net revenue (online-enabled games) | (120 bps) |
All values are in US Dollars.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | ||
|---|---|---|
| Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures | ||
| (in millions) | ||
| The following table provides a reconciliation of non-GAAP operating income and margin to their most directly comparable GAAP financial measure for the three months ended March 31, 2025 plus a comparison to the actuals for the three months ended March 31, 2024. | ||
| 2024 | YOY % Change | |
| Net revenue | 1,779 | 7% |
| GAAP operating income | 234 | 69% |
| Acquisition-related expenses | 101 | |
| Restructuring and related charges | 61 | |
| Stock-based compensation | 148 | |
| Non-GAAP operating income | 544 | 8% |
| GAAP operating margin | 13.2% | |
| Non-GAAP operating margin | 30.6% | |
| Impact from change in deferred net revenue (online-enabled games) | (470 bps) |
All values are in US Dollars.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | ||||||||
|---|---|---|---|---|---|---|---|---|
| GAAP Guidance to Non-GAAP Guidance | ||||||||
| (in millions) | ||||||||
| The following table provides GAAP to Non-GAAP reconciliation of the Company’s FY26 guidance. | ||||||||
| GAAP-Based Financial Data | ||||||||
| A | B | C | ||||||
| Acquisition-related expenses5 | Stock-based compensation5 | Non-GAAP Guidance Range = A + B +C | Change in deferred net revenue (online-enabled games)5 | |||||
| Net revenue | to | 7,500 | — | — | 7,100 | to | 7,500 | 500 |
| Cost of revenue | to | 1,515 | (40) | (15) | 1,420 | to | 1,460 | — |
| Operating expense | to | 4,570 | (70) | (650) | 3,750 | to | 3,850 | — |
| Operating margin | to | 18.9% | 150 bps | 910 bps | 27.2% | to | 29.2% | 480 bps to 440 bps |
| Income before provision for income taxes | to | 1,391 | 110 | 665 | 1,911 | to | 2,166 | 500 |
| Net income4 | to | 974 | ||||||
| Number of shares used in computation: | ||||||||
| Diluted |
All values are in US Dollars.
4 The Company uses a tax rate of 19% internally to evaluate its operating performance and to forecast, plan and analyze future periods.
5 The mid-point of the range has been used for purposes of presenting reconciling items to operating margin.
| ELECTRONIC ARTS INC. AND SUBSIDIARIES | ||||||
|---|---|---|---|---|---|---|
| GAAP-Based Financial Data for Guidance | ||||||
| (in millions) | ||||||
| The following table provides supplemental information to the Company’s Q1 FY26 guidance. | ||||||
| Acquisition-related expenses | Stock-based compensation | Change in deferred net revenue (online-enabled games) | ||||
| Net revenue | to | 1,650 | — | — | (375) | |
| Cost of revenue | to | 285 | (10) | (5) | — | |
| Operating expense | to | 1,120 | (20) | (145) | — | |
| Income before provision for income taxes | to | 242 | 30 | 150 | (375) | |
| Net income4 | to | 169 | ||||
| Number of shares used in computation: | ||||||
| Diluted |
All values are in US Dollars.
4 The Company uses a tax rate of 19% internally to evaluate its operating performance and to forecast, plan and analyze future periods.
Non-GAAP Financial Measures
As a supplement to the Company’s financial measures presented in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), the Company presents certain non-GAAP measures of financial performance, including non-GAAP operating margin and free cash flow. These non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. In addition, these non-GAAP measures have limitations in that they do not reflect all of the items associated with the Company’s results of operations as determined in accordance with GAAP. These non-GAAP financial measures do not reflect a comprehensive system of accounting and differ from GAAP measures with the same names and may differ from non-GAAP financial measures with the same or similar names that are used by other companies.
The non-GAAP financial measures exclude acquisition-related expenses, stock-based compensation, restructuring and related charges, and capital expenditures, as applicable in any given reporting period and our outlook. The Company may consider whether other significant items that arise in the future should be excluded from our non-GAAP financial measures. Management believes that these non-GAAP financial measures provide investors with additional useful information to better understand and evaluate the Company’s operating results and future prospects because they exclude certain items that may not be indicative of the Company’s core business, operating results, or future outlook. These non-GAAP financial measures, with further adjustments are used by management to understand ongoing financial and business performance.
The Company uses a tax rate of 19% internally to evaluate its operating performance and to forecast, plan, and analyze future periods. Accordingly, the Company applies the same tax rate to its management reporting financial results.
Investors are encouraged to review the related GAAP financial measures and the reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measure.