Electronic Arts (EA) Reports Marginal Growth in Revenue Due to Drop in Demand for Video Games

Electronic Arts (EA) has disclosed its financial results for the third quarter ending December 31, 2023, revealing a revenue of $1,945 million compared to $1,881 million in the same period.
Electronic Arts EA game BattlefieldFactors such as still-high interest rates affecting gamer spending habits and intense competition in the video game industry have impacted the sales of EA’s gaming titles, including “Star Wars Jedi: Survivor,” during the holiday quarter.

“Our teams delivered a strong Q3, entertaining hundreds of millions of people across our portfolio, driving engagement and record live services,” said Andrew Wilson, CEO of EA. “We remain focused on growing our biggest franchises and delivering new, innovative games and experiences for our global communities.”

Selected Operating Highlights:

Bookings for Q3 reached $2.366 billion, reflecting a 1 percent increase.

Live services and other bookings for Q3 set a record at $1.712 billion, showing a 3 percent rise.

The EA SPORTS FC franchise exceeded Q3 expectations, achieving 7 percent net bookings growth compared to the prior year, which included the World Cup.

Q4 Targets for EA:

Revenue is anticipated to range between approximately $1.625 billion to $1.925 billion.

Net income is expected to be approximately $54 million to $183 million.

Bookings are projected to be around $1.625 billion to $1.925 billion.

Full Fiscal-Year Targets for EA:

Revenue is targeted at approximately $7.408 billion to $7.708 billion.

Net income is expected to be approximately $1.145 billion to $1.274 billion.

Bookings are estimated to be around $7.389 billion to $7.689 billion.

In the face of an uncertain economic outlook, video game publishers are fiercely competing for top positions. Titles like “Call of Duty: Modern Warfare 3” from Activision Blizzard and Nintendo’s “Super Mario Bros. Wonder” have dominated sales, as reported by market research firm Circana.

Wedbush Securities analyst Michael Pachter attributes EA’s results to the absence of major titles released in the December quarter and the challenging comparison to the previous year.

Stuart Canfield, CFO of EA, commented, “EA SPORTS FC outperformed expectations again this quarter, delivering 7 percent bookings growth, as momentum continued through the FC brand transition. We will continue to build upon the strength within our portfolio, while prioritizing investments in our largest opportunities for multi-year growth.”

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