EA’s Q1 FY25 Results: Revenue Dips, But Income Soars in Impressive Turnaround

In a recent announcement, Electronic Arts (NASDAQ: EA) launched its preliminary financial results for the first quarter of 2024, and boy, are they impressive! The gaming giant exceeded net bookings guidance, proving that they are on top of their game.

Andrew Wilson, the CEO of EA, expressed his excitement about the strong start to FY25, highlighting the company’s commitment to delivering bigger, bolder, and more connected experiences for players. He specifically mentioned the record-breaking launch of EA SPORTS College Football 25, which sets the stage for another historic sports season at EA in the second quarter.

Stuart Canfield, the CFO of EA, echoed Wilson’s sentiments, emphasizing the remarkable success of College Football’s launch week and the upcoming releases of EA SPORTS Madden NFL, EA SPORTS FC, and Dragon Age: The Veilguard. These highly anticipated games are expected to build even more momentum for FY25 and beyond.

Let’s dive into some of the selected operating highlights and metrics that contributed to EA’s stellar performance. Net bookings for the quarter reached a whopping $1.262 billion, surpassing the high end of the guidance range. This achievement was fueled by the outstanding performance of Madden NFL 24, FC Online, and FC Mobile.

EA SPORTS FC also played a significant role in EA’s success during Q1. The franchise celebrated real-world tournaments and events, attracting millions of new fans and driving engagement across the board.

Madden NFL, a perennial favorite among gamers, maintained its momentum throughout the quarter. With weekly average users in Ultimate Team and total net bookings seeing double-digit growth compared to the previous year, it’s safe to say that Madden NFL is still going strong.

In the realm of new releases, EA launched gameplay for Dragon Age: The Veilguard, a highly anticipated title that garnered immense attention. The gameplay trended at number one on YouTube Gaming and received millions of views, indicating a high level of excitement among fans.

And let’s not forget the highlight of the quarter, EA SPORTS College Football 25. This game welcomed a staggering 5 million unique players in its first week, with an additional 500,000 players joining through the EA Play trial. These numbers speak volumes about the game’s popularity and the enthusiasm it has generated among gamers.

Now, let’s take a look at some of the financial highlights and metrics. Net revenue for the quarter amounted to $1.660 billion, while net cash provided by operating activities reached $120 million for the quarter and an impressive $2.076 billion for the trailing twelve months.

EA also made significant strides in its stock repurchase program, repurchasing 2.8 million shares for $375 million during the quarter. This brings the total number of shares repurchased in the past twelve months to 10.2 million, with a value of $1.350 billion.

In terms of dividends, EA has declared a quarterly cash dividend of $0.19 per share of the company’s common stock. Stockholders of record as of August 28, 2024, will receive the dividend on September 18, 2024.

Looking ahead, EA has provided its business outlook for the fiscal year 2025, ending on March 31, 2025. The company expects net revenue to range from approximately $7.100 billion to $7.500 billion, with a change in deferred net revenue (online-enabled games) of around $200 million. Net income is projected to be between $904 million and $1.085 billion, resulting in diluted earnings per share of approximately $3.34 to $4.00. Operating cash flow is estimated to be around $2.050 billion to $2.250 billion.

For the second quarter of fiscal year 2025, ending on September 30, 2024, EA anticipates net revenue to be approximately $1.900 billion to $2.000 billion. The change in deferred net revenue (online-enabled games) is expected to be around $50 million. Net income is projected to range from $204 million to $248 million, with diluted earnings per share of approximately $0.76 to $0.93.

All in all, EA’s preliminary financial results for the first quarter of 2024 are nothing short of impressive. The company’s focus on delivering exceptional gaming experiences, coupled with its strategic releases and strong player engagement, has positioned it for continued success in the coming quarters. With highly anticipated titles on the horizon, EA is poised to conquer the gaming world and deliver on its multi-year financial objectives.