Tue, May 13, 8:06 PM (34 days ago)
**Electronic Arts Inc. (EA, NASDAQ: EA)** **Financial Performance (FY 2025):** - **Revenue:** $7,463 million, down 1% year-over-year. - **Net Income:** $1,121 million, with diluted earnings per share of $4.25. - **Operating Expenses:** $4,400 million, up 2% year-over-year. - **Operating Income:** $1,520 million, flat year-over-year. - **Gross Margin:** 79.3%, up 2 percentage points year-over-year. - **Live Services Net Revenue:** $5,461 million, down 2% year-over-year. - **Digital Full Game Downloads:** $1,478 million, up 10% year-over-year. - **Packaged Goods Sales:** $524 million, down 22% year-over-year. - **Net Bookings:** $7,355 million, down 1% year-over-year. - **Cash Provided by Operations:** $2,079 million, down 10% year-over-year. - **Total Cash, Cash Equivalents, and Short-Term Investments:** $2,248 million. **Strategic Overview:** - Focus on building games and experiences that grow global online communities. - Deepening engagement through connecting interactive storytelling to key intellectual property. - Harnessing communities to grow in, around, and beyond games. - Offering high-quality experiences designed to provide value to players and extend and enhance gameplay. **Future Outlook:** - Expects to continue paying comparable cash dividends on a quarterly basis. - Plans to return $2,699 million to stockholders through capital return programs. - Expects capital expenditures to be approximately $225 million in fiscal year 2026. - Believes cash, cash equivalents, short-term investments, cash generated from operations, and available financing facilities will be sufficient to meet material cash requirements. **Risk Factors:** - Intensely competitive market. - Dependence on successful and engaging products and services. - Rapid technological advances and industry changes. - High expectations for quality and integrity. - Complex software programs and quality controls. - Integration of artificial intelligence tools and technologies. - Dependence on third-party consoles, platforms, and devices. - Seasonality and economic conditions. - Legal and compliance risks. - Market risks including foreign currency exchange rates and interest rates. **Market Position Changes:** - Sony and Microsoft sales represented approximately 39% and 17% of total net revenue, respectively. - Digital full game units sold were 78% of total units sold. - Live services net revenue generated from extra content purchased within Ultimate Team is material to the business. **Financial Condition:** - Material cash requirements include licensing intellectual property, debt repayment obligations, and operating requirements. - Foreign cash is available for repatriation without a material tax cost. - May raise additional capital to repay debt, strengthen financial position, facilitate expansion, repurchase stock, pursue strategic acquisitions and investments, and take advantage of business opportunities.