Electronic Arts Reports Q4 and FY23 Results
Record Q4 net bookings driven by all-time high EA SPORTS FIFA franchise performance;
Company carries strong momentum into brand launch of EA SPORTS FC
Redwood City, CA —Electronic Arts Inc. announced preliminary financial results for its fourth quarter and fiscal year ended March 31, 2023.“Looking ahead, our teams remain disciplined in prioritizing the player experience as we continue to focus our investments on long-term growth.”
“EA delivered a strong Q4 with record net bookings, up 11 percent year-over-year, demonstrating the strength of our business. Our teams continue to create high quality entertainment, fueled by amazing games and deeply engaging live services,” said Andrew Wilson, CEO of Electronic Arts. “We’re excited to continue our momentum, including the highly anticipated launch of EA SPORTS FC later this year.”
“Record live services performance and increased engagement, particularly from our EA SPORTS FIFA franchise, drove better-than-expected Q4 net bookings, capping a strong finish to the fiscal year,” said Chris Suh, CFO. “Looking ahead, our teams remain disciplined in prioritizing the player experience as we continue to focus our investments on long-term growth.”
Selected Operating Highlights and Metrics1
- Net bookings2 for Q4 was $1.946 billion, up 11% year-over-year (up 15% in constant currency).
- Live services and other net bookings for Q4 was $1.622 billion, a record for the quarter, up 9% year-over-year (up 13% in constant currency) and represented 83% of total net bookings.
- The EA SPORTS FIFA franchise Q4 net bookings grew 31% year-over-year (up 37% in constant currency).
- In the six months since launch, EA SPORTS FIFA 23 has surpassed life-time sales of EA SPORTS FIFA 22, becoming the most successful launch in franchise history.
- Apex Legends delivered net bookings growth in Q4 year-over-year at constant currency, driven by a successful Season 16 with peak weekly active users up over 20% from the previous season.
- Life-to-date, The Sims 4 player network has grown to more than 70 million worldwide.
Selected Financial Highlights and Metrics
- Net revenue was $1.874 billion for the quarter and $7.426 billion for the fiscal year.
- Net cash provided by operating activities was $617 million for the quarter and $1.550 billion for the fiscal year.
- EA repurchased 2.7 million shares for $325 million during the quarter, bringing the total for the fiscal year to 10.4 million shares for $1.295 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 21, 2023 to shareholders of record as of the close of business on May 31, 2023.
Quarterly Financial Highlights
| Three Months Ended | |||||
| March 31, | |||||
|
2023 |
2022 |
||||
| (in $ millions, except per share amounts) | |||||
| Full game |
372 |
|
438 |
||
| Live services and other |
1,502 |
|
1,387 |
||
| Total net revenue |
1,874 |
|
1,825 |
||
| Net income (loss) |
(12 |
) |
225 |
||
| Diluted earnings (loss) per share |
(0.04 |
) |
0.80 |
||
| Operating cash flow |
617 |
|
444 |
||
| Value of shares repurchased |
325 |
|
325 |
||
| Number of shares repurchased |
2.7 |
|
2.5 |
||
| Cash dividend paid |
52 |
|
48 |
||
The following GAAP-based financial data3,4 and tax rate of 19% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results:
|
Three Months Ended March 31, 2023 |
||||||||||||
|
GAAP-Based Financial Data |
||||||||||||
| (in $ millions) | Statement of Operations |
Acquisition- related expenses |
Change in deferred net revenue (online- enabled games) |
Restructuring and related charges |
Stock-based compensation |
|||||||
| Total net revenue |
1,874 |
– |
|
72 |
– |
|
– |
|
||||
| Cost of revenue |
448 |
(25 |
) |
– |
– |
|
(2 |
) |
||||
| Gross profit |
1,426 |
25 |
|
72 |
– |
|
2 |
|
||||
| Total operating expenses |
1,251 |
(26 |
) |
– |
(155 |
) |
(140 |
) |
||||
| Operating income |
175 |
51 |
|
72 |
155 |
|
142 |
|
||||
| Interest and other income (expense), net |
6 |
– |
|
– |
– |
|
– |
|
||||
| Income before provision for income taxes |
181 |
51 |
|
72 |
155 |
|
142 |
|
||||
| Number of shares used in computation: | ||||||||||||
| Diluted |
274 |
|||||||||||
Fiscal Year Financial Highlights
| Twelve Months Ended | ||||
| March 31, | ||||
|
2023 |
2022 |
|||
| (in $ millions) | ||||
| Full game |
1,937 |
1,993 |
||
| Live services and other |
5,489 |
4,998 |
||
| Total net revenue |
7,426 |
6,991 |
||
| Net income |
802 |
789 |
||
| Diluted earnings per share |
2.88 |
2.76 |
||
| Operating cash flow |
1,550 |
1,899 |
||
| Value of shares repurchased |
1,295 |
1,300 |
||
| Number of shares repurchased |
10.4 |
9.5 |
||
| Cash dividend paid |
210 |
193 |
||
The following GAAP-based financial data3,4 and a tax rate of 19% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results.
| Twelve Months Ended March 31, 2023 | ||||||||||||||
| GAAP-Based Financial Data | ||||||||||||||
| (in $ millions) | Statement of Operations |
Acquisition- related expenses |
Change in deferred net revenue (online- enabled games) |
Restructuring and related charges |
Stock-based compensation |
|||||||||
| Total net revenue |
7,426 |
|
– |
|
(85 |
) |
– |
|
– |
|
||||
| Cost of revenue |
1,792 |
|
(120 |
) |
– |
|
– |
|
(7 |
) |
||||
| Gross profit |
5,634 |
|
120 |
|
(85 |
) |
– |
|
7 |
|
||||
| Total operating expenses |
4,302 |
|
(158 |
) |
– |
|
(155 |
) |
(541 |
) |
||||
| Operating income |
1,332 |
|
278 |
|
(85 |
) |
155 |
|
548 |
|
||||
| Interest and other income (expense), net |
(6 |
) |
– |
|
– |
|
– |
|
– |
|
||||
| Income before provision for income taxes |
1,326 |
|
278 |
|
(85 |
) |
155 |
|
548 |
|
||||
| Number of shares used in computation: | ||||||||||||||
| Diluted |
278 |
|
||||||||||||
Operating Metric
The following is a calculation of our total net bookings2 for the periods presented:
|
Three Months Ended |
|
Twelve Months Ended |
||||||||
|
March 31, |
|
March 31, |
||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
| (in $ millions) | ||||||||||
| Total net revenue |
1,874 |
1,825 |
|
7,426 |
|
6,991 |
||||
| Change in deferred net revenue (online-enabled games) |
72 |
(74 |
) |
(85 |
) |
524 |
||||
| Total net bookings |
1,946 |
1,751 |
|
7,341 |
|
7,515 |
||||
Business Outlook as of May 9, 2023
Fiscal Year 2024 Expectations – Ending March 31, 2024
Financial metrics:
- Net revenue is expected to be approximately $7.300 billion to $7.700 billion.
- No change in deferred net revenue (online-enabled games) is expected.
- Net income is expected to be approximately $915 million to $1.055 billion.
- Diluted earnings per share is expected to be approximately $3.30 to $3.81.
- Operating cash flow is expected to be approximately $1.700 billion to $1.850 billion.
- The Company estimates a share count of 277 million for purposes of calculating fiscal year 2024 diluted earnings per share.
Operational metric:
- Net bookings2 is expected to be approximately $7.300 billion to $7.700 billion.
In addition, the following outlook for GAAP-based financial data3,4 and long-term tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods:
| Twelve Months Ending March 31, 2024 | |||||||||||||
| GAAP-Based Financial Data* | |||||||||||||
| GAAP Guidance Range |
Acquisition- related expenses |
Change in deferred net revenue (online- enabled games) |
Restructuring and related charges |
Stock-based compensation |
|||||||||
| (in $ millions) | |||||||||||||
| Total net revenue | 7,300 to 7,700 |
– |
|
– |
– |
|
– |
|
|||||
| Cost of revenue | 1,670 to 1,750 |
(65 |
) |
– |
– |
|
(5 |
) |
|||||
| Operating expense | 4,295 to 4,415 |
(95 |
) |
– |
(25 |
) |
(635 |
) |
|||||
| Income before provision for income taxes | 1,346 to 1,551 |
160 |
|
– |
25 |
|
640 |
|
|||||
| Net income | 915 to 1,055 | ||||||||||||
| Number of shares used in computation: | |||||||||||||
| Diluted shares |
277 |
||||||||||||
| * The mid-point of the range has been used for purposes of presenting the reconciling items. | |||||||||||||
First Quarter Fiscal Year 2024 Expectations – Ending June 30, 2023
Financial metrics:
- Net revenue is expected to be approximately $1.825 billion to $1.925 billion.
- Change in deferred net revenue (online-enabled games) is expected to be approximately ($325) million.
- Net income is expected to be approximately $271 million to $316 million.
- Diluted earnings per share is expected to be approximately $0.98 to $1.14.
- The Company estimates a share count of 277 million for purposes of calculating first quarter fiscal 2024 diluted earnings per share.
Operational metric:
- Net bookings2 is expected to be approximately $1.500 billion to $1.600 billion.
In addition, the following outlook for GAAP-based financial data3,4 and long-term tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods:
| Three Months Ending June 30, 2023 | ||||||||||||||
| GAAP-Based Financial Data* | ||||||||||||||
| GAAP Guidance Range |
Acquisition- related expenses |
Change in deferred net revenue (online- enabled games) |
Restructuring and related charges |
Stock-based compensation |
||||||||||
| (in $ millions) | ||||||||||||||
| Total net revenue | 1,825 to 1,925 |
– |
|
(325 |
) |
– |
|
– |
|
|||||
| Cost of revenue | 350 to 370 |
(20 |
) |
– |
|
– |
|
– |
|
|||||
| Operating expense | 1,065 to 1,085 |
(25 |
) |
– |
|
(20 |
) |
(140 |
) |
|||||
| Income before provision for income taxes | 410 to 479 |
45 |
|
(325 |
) |
20 |
|
140 |
|
|||||
| Net income | 271 to 316 | |||||||||||||
| Number of shares used in computation: | ||||||||||||||
| Diluted shares |
277 |
|||||||||||||
| * The mid-point of the range has been used for purposes of presenting the reconciling items. | ||||||||||||||
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 2023, EA posted GAAP net revenue of approximately $7.4 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™, Madden NFL, Need for Speed™, Titanfall™, Plants vs. Zombies™ and F1®. More information about EA is available at www.ea.com/news.
EA SPORTS, Battlefield, Need for Speed, Apex Legends, The Sims, Titanfall and Plants vs. Zombies are trademarks of Electronic Arts Inc. STAR WARS © & TM 2015 Lucasfilm Ltd. All rights reserved. John Madden, NFL, FIFA and F1 are the property of their respective owners and used with permission.
1 For more information on constant currency, please refer to the earnings slides available on EA’s IR Website.
2 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.
3 For more information about the nature of the GAAP-based financial data, please refer to EA’s Form 10-K for the fiscal year ended March 31, 2022.
4 On March 29, 2023, EA announced a restructuring plan focused on prioritizing investments aligned with the Company’s growth opportunities and optimizing its real estate portfolio.
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
|||||||||||
|
Unaudited Condensed Consolidated Statements of Operations |
|||||||||||
|
(in $ millions, except per share data) |
|||||||||||
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
Twelve Months Ended |
||||||||
|
|
|
||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
Net revenue |
1,874 |
|
|
1,825 |
|
|
7,426 |
|
|
6,991 |
|
|
Cost of revenue |
448 |
|
|
419 |
|
|
1,792 |
|
|
1,859 |
|
|
Gross profit |
1,426 |
|
|
1,406 |
|
|
5,634 |
|
|
5,132 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
||||
|
Research and development |
635 |
|
|
579 |
|
|
2,328 |
|
|
2,186 |
|
|
Marketing and sales |
255 |
|
|
245 |
|
|
978 |
|
|
961 |
|
|
General and administrative |
224 |
|
|
165 |
|
|
727 |
|
|
673 |
|
|
Amortization and impairment of intangibles |
26 |
|
|
52 |
|
|
158 |
|
|
183 |
|
|
Restructuring |
111 |
|
|
— |
|
|
111 |
|
|
— |
|
|
Total operating expenses |
1,251 |
|
|
1,041 |
|
|
4,302 |
|
|
4,003 |
|
|
Operating income |
175 |
|
|
365 |
|
|
1,332 |
|
|
1,129 |
|
|
Interest and other income (expense), net |
6 |
|
|
(9 |
) |
|
(6 |
) |
|
(48 |
) |
|
Income before provision for income taxes |
181 |
|
|
356 |
|
|
1,326 |
|
|
1,081 |
|
|
Provision for income taxes |
193 |
|
|
131 |
|
|
524 |
|
|
292 |
|
|
Net income (loss) |
(12 |
) |
|
225 |
|
|
802 |
|
|
789 |
|
|
Earnings (loss) per share |
|
|
|
|
|
|
|
||||
|
Basic |
(0.04 |
) |
|
0.80 |
|
|
2.90 |
|
|
2.78 |
|
|
Diluted |
(0.04 |
) |
|
0.80 |
|
|
2.88 |
|
|
2.76 |
|
|
Number of shares used in computation |
|
|
|
|
|
|
|
||||
|
Basic |
274 |
|
|
281 |
|
|
277 |
|
|
284 |
|
|
Diluted |
274 |
|
|
283 |
|
|
278 |
|
|
286 |
|
Results (in $ millions, except per share data)
The following table reports the variance of the actuals versus our guidance provided on January 31, 2023 for the three months ended March 31, 2023 plus a comparison to the actuals for the three months ended March 31, 2022.
|
|
Three Months Ended March 31, |
||||||||||
|
|
2023 Guidance (Mid-Point) |
|
|
|
2023 Actuals |
|
2022 Actuals |
||||
|
|
|
Variance |
|
|
|||||||
|
Net revenue |
|
|
|
|
|
|
|
||||
|
Net revenue |
1,750 |
|
|
124 |
|
|
1,874 |
|
|
1,825 |
|
|
GAAP-based financial data |
|
|
|
|
|
|
|
||||
|
Change in deferred net revenue (online-enabled games)1 |
(25 |
) |
|
97 |
|
|
72 |
|
|
(74 |
) |
|
Cost of revenue |
|
|
|
|
|
|
|
||||
|
Cost of revenue |
405 |
|
|
43 |
|
|
448 |
|
|
419 |
|
|
GAAP-based financial data |
|
|
|
|
|
|
|
||||
|
Acquisition-related expenses |
(25 |
) |
|
— |
|
|
(25 |
) |
|
(45 |
) |
|
Stock-based compensation |
— |
|
|
(2 |
) |
|
(2 |
) |
|
(2 |
) |
|
Operating expenses |
|
|
|
|
|
|
|
||||
|
Operating expenses |
1,080 |
|
|
171 |
|
|
1,251 |
|
|
1,041 |
|
|
GAAP-based financial data |
|
|
|
|
|
|
|
||||
|
Acquisition-related expenses |
(35 |
) |
|
9 |
|
|
(26 |
) |
|
(52 |
) |
|
Restructuring and related charges |
— |
|
|
(155 |
) |
|
(155 |
) |
|
— |
|
|
Stock-based compensation |
(140 |
) |
|
— |
|
|
(140 |
) |
|
(123 |
) |
|
Income before tax |
|
|
|
|
|
|
|
||||
|
Income before tax |
270 |
|
|
(89 |
) |
|
181 |
|
|
356 |
|
|
GAAP-based financial data |
|
|
|
|
|
|
|
||||
|
Acquisition-related expenses |
60 |
|
|
(9 |
) |
|
51 |
|
|
97 |
|
|
Change in deferred net revenue (online-enabled games)1 |
(25 |
) |
|
97 |
|
|
72 |
|
|
(74 |
) |
|
Restructuring and related charges |
— |
|
|
155 |
|
|
155 |
|
|
— |
|
|
Stock-based compensation |
140 |
|
|
2 |
|
|
142 |
|
|
125 |
|
|
Tax rate used for management reporting |
19 |
% |
|
|
|
19 |
% |
|
18 |
% |
|
|
Earnings (loss) per share |
|
|
|
|
|
|
|
||||
|
Basic |
0.13 |
|
|
(0.17 |
) |
|
(0.04 |
) |
|
0.80 |
|
|
Diluted |
0.13 |
|
|
(0.17 |
) |
|
(0.04 |
) |
|
0.80 |
|
|
Number of shares used in computation |
|
|
|
|
|
|
|
||||
|
Basic |
275 |
|
|
(1 |
) |
|
274 |
|
|
281 |
|
|
Diluted |
277 |
|
|
(3 |
) |
|
274 |
|
|
283 |
|
|
Anti-dilutive shares excluded for loss position2 |
— |
|
|
1 |
|
|
1 |
|
|
— |
|
|
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. 2 Diluted earnings per share reflects the potential dilution from common shares (calculated using the treasury stock method), issuable through stock-based compensation plans. When the company incurs a loss, shares issuable though stock-based compensation plans are excluded from the diluted loss per share calculation as inclusion would be anti-dilutive. |
|||||||||||
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
||||
|
Unaudited Condensed Consolidated Balance Sheets |
||||
|
(in $ millions) |
||||
|
|
|
|
|
|
|
|
March 31, 2023 |
|
March 31, 20223 |
|
|
ASSETS |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash equivalents |
2,424 |
|
|
2,732 |
|
Short-term investments |
343 |
|
|
330 |
|
Receivables, net |
684 |
|
|
650 |
|
Other current assets |
518 |
|
|
439 |
|
Total current assets |
3,969 |
|
|
4,151 |
|
Property and equipment, net |
549 |
|
|
550 |
|
Goodwill |
5,380 |
|
|
5,387 |
|
Acquisition-related intangibles, net |
618 |
|
|
962 |
|
Deferred income taxes, net |
2,462 |
|
|
2,243 |
|
Other assets |
481 |
|
|
507 |
|
TOTAL ASSETS |
13,459 |
|
|
13,800 |
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Accounts payable |
99 |
|
|
101 |
|
Accrued and other current liabilities |
1,285 |
|
|
1,388 |
|
Deferred net revenue (online-enabled games) |
1,901 |
|
|
2,024 |
|
Total current liabilities |
3,285 |
|
|
3,513 |
|
Senior notes, net |
1,880 |
|
|
1,878 |
|
Income tax obligations |
607 |
|
|
386 |
|
Deferred income taxes, net |
1 |
|
|
1 |
|
Other liabilities |
393 |
|
|
397 |
|
Total liabilities |
6,166 |
|
|
6,175 |
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
Common stock |
3 |
|
|
3 |
|
Retained earnings |
7,357 |
|
|
7,607 |
|
Accumulated other comprehensive income (loss) |
(67 |
) |
|
15 |
|
Total stockholders’ equity |
7,293 |
|
|
7,625 |
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
13,459 |
|
|
13,800 |
|
3Derived from audited consolidated financial statements. |
||||
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
|||||||||||
|
Unaudited Condensed Consolidated Statements of Cash Flows |
|||||||||||
|
(in $ millions) |
|||||||||||
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
Twelve Months Ended |
||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
OPERATING ACTIVITIES |
|
|
|
|
|
|
|
||||
|
Net income (loss) |
(12 |
) |
|
225 |
|
|
802 |
|
|
789 |
|
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
|
|
|
|
|
|
|
||||
|
Depreciation, amortization, accretion and impairment |
173 |
|
|
141 |
|
|
536 |
|
|
486 |
|
|
Stock-based compensation |
142 |
|
|
125 |
|
|
548 |
|
|
528 |
|
|
Change in assets and liabilities |
|
|
|
|
|
|
|
||||
|
Receivables, net |
152 |
|
|
313 |
|
|
(34 |
) |
|
(77 |
) |
|
Other assets |
(50 |
) |
|
(82 |
) |
|
(103 |
) |
|
(157 |
) |
|
Accounts payable |
31 |
|
|
2 |
|
|
10 |
|
|
(7 |
) |
|
Accrued and other liabilities |
106 |
|
|
(14 |
) |
|
134 |
|
|
169 |
|
|
Deferred income taxes, net |
(18 |
) |
|
(189 |
) |
|
(221 |
) |
|
(329 |
) |
|
Deferred net revenue (online-enabled games) |
93 |
|
|
(77 |
) |
|
(122 |
) |
|
497 |
|
|
Net cash provided by operating activities |
617 |
|
|
444 |
|
|
1,550 |
|
|
1,899 |
|
|
|
|
|
|
|
|
|
|
||||
|
INVESTING ACTIVITIES |
|
|
|
|
|
|
|
||||
|
Capital expenditures |
(47 |
) |
|
(53 |
) |
|
(207 |
) |
|
(188 |
) |
|
Proceeds from maturities and sales of short-term investments |
152 |
|
|
136 |
|
|
395 |
|
|
1,329 |
|
|
Purchase of short-term investments |
(142 |
) |
|
(116 |
) |
|
(405 |
) |
|
(554 |
) |
|
Acquisitions, net of cash acquired |
— |
|
|
— |
|
|
— |
|
|
(3,391 |
) |
|
Net cash used in investing activities |
(37 |
) |
|
(33 |
) |
|
(217 |
) |
|
(2,804 |
) |
|
|
|
|
|
|
|
|
|
||||
|
FINANCING ACTIVITIES |
|
|
|
|
|
|
|
||||
|
Proceeds from issuance of common stock |
33 |
|
|
33 |
|
|
80 |
|
|
77 |
|
|
Cash dividends paid |
(52 |
) |
|
(48 |
) |
|
(210 |
) |
|
(193 |
) |
|
Cash paid to taxing authorities for shares withheld from employees |
(14 |
) |
|
(11 |
) |
|
(175 |
) |
|
(204 |
) |
|
Repurchase and retirement of common stock |
(325 |
) |
|
(325 |
) |
|
(1,295 |
) |
|
(1,300 |
) |
|
Net cash used in financing activities |
(358 |
) |
|
(351 |
) |
|
(1,600 |
) |
|
(1,620 |
) |
|
|
|
|
|
|
|
|
|
||||
|
Effect of foreign exchange on cash and cash equivalents |
— |
|
|
2 |
|
|
(41 |
) |
|
(3 |
) |
|
Change in cash and cash equivalents |
222 |
|
|
62 |
|
|
(308 |
) |
|
(2,528 |
) |
|
Beginning cash and cash equivalents |
2,202 |
|
|
2,670 |
|
|
2,732 |
|
|
5,260 |
|
|
Ending cash and cash equivalents |
2,424 |
|
|
2,732 |
|
|
2,424 |
|
|
2,732 |
|
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
|||||||||||||||||
|
Unaudited Supplemental Financial Information and Business Metrics |
|||||||||||||||||
|
(in $ millions, except per share data) |
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
Q4 |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
YOY % |
||||||
|
|
FY22 |
|
FY23 |
|
FY23 |
|
FY23 |
|
FY23 |
|
Change |
||||||
|
Net revenue |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Net revenue |
1,825 |
|
|
1,767 |
|
|
1,904 |
|
|
1,881 |
|
|
1,874 |
|
|
3 |
% |
|
GAAP-based financial data |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Change in deferred net revenue (online-enabled games)1 |
(74 |
) |
|
(468 |
) |
|
(150 |
) |
|
461 |
|
|
72 |
|
|
|
|
|
Gross profit |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Gross profit |
1,406 |
|
|
1,453 |
|
|
1,442 |
|
|
1,313 |
|
|
1,426 |
|
|
1 |
% |
|
Gross profit (as a % of net revenue) |
77 |
% |
|
82 |
% |
|
76 |
% |
|
70 |
% |
|
76 |
% |
|
|
|
|
GAAP-based financial data |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Acquisition-related expenses |
45 |
|
|
30 |
|
|
39 |
|
|
26 |
|
|
25 |
|
|
|
|
|
Change in deferred net revenue (online-enabled games)1 |
(74 |
) |
|
(468 |
) |
|
(150 |
) |
|
461 |
|
|
72 |
|
|
|
|
|
Stock-based compensation |
2 |
|
|
2 |
|
|
1 |
|
|
2 |
|
|
2 |
|
|
|
|
|
Operating income |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Operating income |
365 |
|
|
441 |
|
|
427 |
|
|
289 |
|
|
175 |
|
|
(52 |
%) |
|
Operating income (as a % of net revenue) |
20 |
% |
|
25 |
% |
|
22 |
% |
|
15 |
% |
|
9 |
% |
|
|
|
|
GAAP-based financial data |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Acquisition-related expenses |
97 |
|
|
69 |
|
|
82 |
|
|
76 |
|
|
51 |
|
|
|
|
|
Change in deferred net revenue (online-enabled games)1 |
(74 |
) |
|
(468 |
) |
|
(150 |
) |
|
461 |
|
|
72 |
|
|
|
|
|
Restructuring and related charges |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
155 |
|
|
|
|
|
Stock-based compensation |
125 |
|
|
125 |
|
|
140 |
|
|
141 |
|
|
142 |
|
|
|
|
|
Net income (loss) |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Net income (loss) |
225 |
|
|
311 |
|
|
299 |
|
|
204 |
|
|
(12 |
) |
|
(105 |
%) |
|
Net income (loss) (as a % of net revenue) |
12 |
% |
|
18 |
% |
|
16 |
% |
|
11 |
% |
|
(1 |
%) |
|
|
|
|
GAAP-based financial data |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Acquisition-related expenses |
97 |
|
|
69 |
|
|
82 |
|
|
76 |
|
|
51 |
|
|
|
|
|
Change in deferred net revenue (online-enabled games)1 |
(74 |
) |
|
(468 |
) |
|
(150 |
) |
|
461 |
|
|
72 |
|
|
|
|
|
Restructuring and related charges |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
155 |
|
|
|
|
|
Stock-based compensation |
125 |
|
|
125 |
|
|
140 |
|
|
141 |
|
|
142 |
|
|
|
|
|
Tax rate used for management reporting |
18 |
% |
|
19 |
% |
|
19 |
% |
|
19 |
% |
|
19 |
% |
|
|
|
|
Diluted earnings (loss) per share |
0.80 |
|
|
1.11 |
|
|
1.07 |
|
|
0.73 |
|
|
(0.04 |
) |
|
(105 |
%) |
|
Number of shares used in computation |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Basic |
281 |
|
|
279 |
|
|
278 |
|
|
276 |
|
|
274 |
|
|
|
|
|
Diluted |
283 |
|
|
281 |
|
|
279 |
|
|
278 |
|
|
274 |
|
|
|
|
|
Anti-dilutive shares excluded for loss position2 |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
|
|
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. 2 Diluted earnings per share reflects the potential dilution from common shares (calculated using the treasury stock method), issuable through stock-based compensation plans. When the company incurs a loss, shares issuable though stock-based compensation plans are excluded from the diluted loss per share calculation as inclusion would be anti-dilutive. |
|||||||||||||||||
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
||||||||||||||||||
|
Unaudited Supplemental Financial Information and Business Metrics |
||||||||||||||||||
|
(in $ millions) |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
Q4 |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
YOY % |
||||||
|
|
|
FY22 |
|
FY23 |
|
FY23 |
|
FY23 |
|
FY23 |
|
Change |
||||||
|
QUARTERLY NET REVENUE PRESENTATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Net revenue by composition |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Full game downloads |
|
312 |
|
|
237 |
|
|
328 |
|
|
423 |
|
|
274 |
|
|
(12 |
%) |
|
Packaged goods |
|
126 |
|
|
104 |
|
|
274 |
|
|
199 |
|
|
98 |
|
|
(22 |
%) |
|
Full game |
|
438 |
|
|
341 |
|
|
602 |
|
|
622 |
|
|
372 |
|
|
(15 |
%) |
|
Live services and other |
|
1,387 |
|
|
1,426 |
|
|
1,302 |
|
|
1,259 |
|
|
1,502 |
|
|
8 |
% |
|
Total net revenue |
|
1,825 |
|
|
1,767 |
|
|
1,904 |
|
|
1,881 |
|
|
1,874 |
|
|
3 |
% |
|
Full game |
|
24 |
% |
|
19 |
% |
|
32 |
% |
|
33 |
% |
|
20 |
% |
|
|
|
|
Live services and other |
|
76 |
% |
|
81 |
% |
|
68 |
% |
|
67 |
% |
|
80 |
% |
|
|
|
|
Total net revenue % |
|
100 |
% |
|
100 |
% |
|
100 |
% |
|
100 |
% |
|
100 |
% |
|
|
|
|
GAAP-based financial data |
|
|
|
|
|
|
||||||||||||
|
Full game downloads |
|
(103 |
) |
|
(111 |
) |
|
17 |
|
|
45 |
|
|
(24 |
) |
|
|
|
|
Packaged goods |
|
(68 |
) |
|
(65 |
) |
|
16 |
|
|
20 |
|
|
(24 |
) |
|
|
|
|
Full game |
|
(171 |
) |
|
(176 |
) |
|
33 |
|
|
65 |
|
|
(48 |
) |
|
|
|
|
Live services and other |
|
97 |
|
|
(292 |
) |
|
(183 |
) |
|
396 |
|
|
120 |
|
|
|
|
|
Total change in deferred net revenue (online-enabled games) by composition1 |
|
(74 |
) |
|
(468 |
) |
|
(150 |
) |
|
461 |
|
|
72 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Net revenue by platform |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Console |
|
1,092 |
|
|
1,042 |
|
|
1,161 |
|
|
1,152 |
|
|
1,088 |
|
|
— |
|
|
PC & Other |
|
420 |
|
|
402 |
|
|
423 |
|
|
435 |
|
|
469 |
|
|
12 |
% |
|
Mobile |
|
313 |
|
|
323 |
|
|
320 |
|
|
294 |
|
|
317 |
|
|
1 |
% |
|
Total net revenue |
|
1,825 |
|
|
1,767 |
|
|
1,904 |
|
|
1,881 |
|
|
1,874 |
|
|
3 |
% |
|
GAAP-based financial data |
|
|
|
|
|
|
||||||||||||
|
Console |
|
(86 |
) |
|
(405 |
) |
|
(134 |
) |
|
423 |
|
|
11 |
|
|
|
|
|
PC & Other |
|
3 |
|
|
(54 |
) |
|
8 |
|
|
29 |
|
|
47 |
|
|
|
|
|
Mobile |
|
9 |
|
|
(9 |
) |
|
(24 |
) |
|
9 |
|
|
14 |
|
|
|
|
|
Total change in deferred net revenue (online-enabled games) by platform1 |
|
(74 |
) |
|
(468 |
) |
|
(150 |
) |
|
461 |
|
|
72 |
|
|
|
|
|
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) |
||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
|
Q4 |
Q1 |
Q2 |
Q3 |
Q4 |
YOY % |
||||||||
|
|
FY22 |
FY23 |
FY23 |
FY23 |
FY23 |
Change |
||||||||
|
CASH FLOW DATA |
|
|
|
|
|
|
||||||||
|
Operating cash flow |
444 |
(78 |
) |
(112 |
) |
1,123 |
617 |
39 |
% |
|||||
|
Operating cash flow – TTM |
1,899 |
1,964 |
|
1,788 |
|
1,377 |
1,550 |
(18 |
%) |
|||||
|
Capital expenditures |
53 |
59 |
|
53 |
|
48 |
47 |
(11 |
%) |
|||||
|
Capital expenditures – TTM |
188 |
203 |
|
213 |
|
213 |
207 |
10 |
% |
|||||
|
Repurchase and retirement of common stock |
325 |
320 |
|
325 |
|
325 |
325 |
— |
|
|||||
|
Cash dividends paid |
48 |
53 |
|
53 |
|
52 |
52 |
8 |
% |
|||||
|
DEPRECIATION |
|
|
|
|
|
|
||||||||
|
Depreciation expense |
42 |
44 |
|
45 |
|
46 |
58 |
38 |
% |
|||||
|
BALANCE SHEET DATA |
|
|
|
|
|
|
||||||||
|
Cash and cash equivalents |
2,732 |
2,082 |
|
1,539 |
|
2,202 |
2,424 |
|
||||||
|
Short-term investments |
330 |
334 |
|
335 |
|
351 |
343 |
|
||||||
|
Cash and cash equivalents, and short-term investments |
3,062 |
2,416 |
|
1,874 |
|
2,553 |
2,767 |
(10 |
%) |
|||||
|
Receivables, net |
650 |
579 |
|
919 |
|
836 |
684 |
5 |
% |
|||||
|
STOCK-BASED COMPENSATION |
|
|
|
|
|
|
||||||||
|
Cost of revenue |
2 |
2 |
|
1 |
|
2 |
2 |
|
||||||
|
Research and development |
84 |
81 |
|
95 |
|
95 |
96 |
|
||||||
|
Marketing and sales |
13 |
13 |
|
16 |
|
15 |
15 |
|
||||||
|
General and administrative |
26 |
29 |
|
28 |
|
29 |
29 |
|
||||||
|
Total stock-based compensation |
125 |
125 |
|
140 |
|
141 |
142 |
|
||||||
|
RESTRUCTURING AND RELATED CHARGES |
|
|
|
|
|
|
||||||||
|
Restructuring |
— |
— |
|
— |
|
— |
111 |
|
||||||
|
Office space reductions |
— |
— |
|
— |
|
— |
44 |
|
||||||
|
Total restructuring and related charges |
— |
— |
|
— |
|
— |
155 |
|
||||||
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