Electronic Arts Reports Strong Q2 FY25 Results

Rhea-AI Summary

Electronic Arts (EA) reported strong Q2 FY25 results with record net bookings of $2.079 billion, exceeding guidance. American Football is on track to exceed $1 billion in net bookings, with Q2 playing hours up 140% year-over-year. Net revenue reached $2.025 billion, while net income was $294 million. The company repurchased 2.6 million shares for $375 million and declared a quarterly dividend of $0.19 per share. Based on strong performance, EA raised its FY25 outlook, projecting net revenue between $7.400-7.700 billion and net bookings of $7.500-7.800 billion.

Positive

• Record Q2 net bookings of $2.079 billion, exceeding guidance
• American Football franchise on track to exceed $1 billion in FY25 net bookings
• 140% year-over-year increase in American Football playing hours
• The Sims 4 gained 15 million new players over the past year
• Operating cash flow increased to $234 million from $112 million year-over-year
• Raised full-year outlook for FY25

Negative

• Net income decreased to $294 million from $399 million year-over-year
• Diluted earnings per share declined to $1.11 from $1.47 year-over-year
• Trailing twelve months revenue decreased to $7,409 million from $7,593 million

Insights

Financial Analyst

EA delivered exceptional Q2 performance with $2.079 billion in net bookings, surpassing guidance of $2.050 billion. Key growth drivers include American Football tracking for $1 billion+ in FY25 bookings with 140% YoY increase in gameplay hours. The company's strategic focus on live services is paying off, with The Sims 4 adding 15 million new players.

The balance sheet remains robust with $234 million operating cash flow for Q2. Management's confidence is evident in the increased FY25 outlook and continued shareholder returns through $375 million in share repurchases and a $0.19 quarterly dividend. While EPS declined from $1.47 to $1.11, this was largely due to a one-time tax benefit in the previous year.

Market Research Analyst

EA's portfolio diversification strategy is showing strong results. The success of College Football 25 as the top-selling HD title in North America, combined with global football growth and The Sims 4's expanding player base, demonstrates effective market penetration across multiple genres. The 140% increase in American Football gameplay hours and doubled new player acquisition indicate strong product engagement and potential for sustained revenue growth.

The raised full-year guidance suggests management's confidence in maintaining momentum, particularly in live services which generated $1.309 billion in Q2 revenue. This recurring revenue stream, combined with successful new releases, positions EA well for continued market leadership.

Record Q2 net bookings driven by performance across EA SPORTS™ portfolio resulting in a raised full-year outlook

REDWOOD CITY, Calif.--(BUSINESS WIRE)-- Electronic Arts (NASDAQ: EA) today announced preliminary financial results for its second quarter ended September 30, 2024.

“EA delivered another strong quarter with record Q2 net bookings, driven by our incredible teams, broad portfolio and technology leadership,” said Andrew Wilson, CEO of EA. “The momentum in our business reinforces our strategic vision to deliver innovative experiences and interactive entertainment that deepens and expands engagement across our global communities.”

“Q2 was another successful quarter for EA, exceeding the high end of our guidance range. As a result, we are also raising our FY25 outlook,” said Stuart Canfield, CFO of EA. “We remain confident in our ability to drive long-term value creation through increased scale, driving top-line growth, improved margins, and greater cash flow as shared at our Investor Day.”

Selected Operating Highlights and Metrics

• Net bookings¹ for the quarter totaled $2.079 billion, setting a Q2 record and exceeding the high end of guidance range of $2.050 billion.
• American Football is on track to exceed $1 billion in net bookings for FY25, with total hours played in Q2 up over 140% year over year, and we also saw new players in the community more than double year over year.
• Through September, College Football 25 was the best-selling HD title in North America and gives EA three of the top ten HD bestsellers in North America.
• Global Football saw live service growth across all platforms in Q2, and total franchise net bookings in FY25 are on track to grow over a record FY24.
• The Sims™ 4 continues to expand, with more than 15 million players joining the game over the past year. Increased engagement led to higher-than-expected net bookings for the franchise in Q2.

Selected Financial Highlights and Metrics

• Net revenue was $2.025 billion for the quarter.
• Net cash provided by operating activities was $234 million for the quarter and $2.198 billion for the trailing twelve months.
• EA repurchased 2.6 million shares for $375 million during the quarter under the stock repurchase program, bringing the total for the trailing twelve months to 10.2 million shares for $1.400 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 December 18, 2024 to stockholders of record as of the close of business on November 27, 2024.

Quarterly Financial Highlights

	Three Months Ended
	September 30,
(in $ millions, except per share amounts)	2024		2023
Full game	716		621
Live services and other	1,309		1,293
Total net revenue	2,025		1,914
Net income	294		399
Diluted earnings per share	1.11		1.47*
Operating cash flow	234		112
Value of shares repurchased	375		325
Number of shares repurchased	2.6		2.6
Cash dividend paid	51		51

* Diluted earnings per share includes $0.34 from a one-time non-cash tax benefit in second quarter ended September 30, 2023.

Trailing Twelve Months Financial Highlights

	Twelve Months Ended
	September 30,
(in $ millions)	2024		2023
Full game	1,917		2,058
Live services and other	5,492		5,535
Total net revenue	7,409		7,593
Net income	1,046		993
Operating cash flow	2,198		2,211
Value of shares repurchased	1,400		1,300
Number of shares repurchased	10.2		10.5

Operating Metric

The following is a calculation of our total net bookings¹ for the periods presented:

	Three Months Ended September 30,					Twelve Months Ended September 30,
(in $ millions)	2024		2023			2024			2023
Total net revenue	2,025		1,914			7,409			7,593
Change in deferred net revenue (online-enabled games)	54		(94	)		(36	)		93
Total net bookings	2,079		1,820			7,373			7,686

Business Outlook as of October 29, 2024

Fiscal Year 2025 Expectations – Ending March 31, 2025

Financial outlook metrics:

• Net revenue is expected to be approximately $7.400 billion to $7.700 billion.
  • Change in deferred net revenue (online-enabled games) is expected to be approximately $100 million.
• Net income is expected to be approximately $1.019 billion to $1.156 billion.
• Diluted earnings per share is expected to be approximately $3.82 to $4.33.
• Operating cash flow is expected to be approximately $2.075 billion to $2.275 billion.
• The Company estimates a share count of 267 million for purposes of calculating diluted earnings per share.

Operational outlook metric:

• Net bookings¹ is expected to be approximately $7.500 billion to $7.800 billion.

Third Quarter Fiscal Year 2025 Expectations – Ending December 31, 2024

Financial outlook metrics:

• Net revenue is expected to be approximately $1.875 billion to $2.025 billion.
  • Change in deferred net revenue (online-enabled games) is expected to be approximately $525 million.
• Net income is expected to be approximately $226 million to $270 million.
• Diluted earnings per share is expected to be approximately $0.85 to $1.02.
• The Company estimates a share count of 266 million for purposes of calculating diluted earnings per share.

Operational outlook metric:

• Net bookings¹ is expected to be approximately $2.400 billion to $2.550 billion.

Conference Call and Supporting Documents

Electronic Arts will host a conference call on October 29, 2024 at 2:00 pm PT (5:00 pm ET) to review its results for the second fiscal quarter ended September 30, 2024 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 (888) 330-2446 (domestic) or (240) 789-2732 (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 November 5, 2024 at (800) 770-2030 (domestic) or (647) 362-9199 (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 October 29, 2024” 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 October 29, 2024. Electronic Arts assumes no obligation to revise or update any forward-looking statement for any reason, 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 Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2024. Electronic Arts assumes no obligation and does not intend to update these estimates prior to filing its Form 10-Q for the fiscal quarter ended September 30, 2024.

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 2024, EA posted GAAP net revenue of approximately $7.6 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, FIFA and F1 are the property of their respective owners and used with permission.

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)
	Three Months Ended September 30,					Six Months Ended September 30,
	2024		2023			2024		2023
Net revenue	2,025		1,914			3,685		3,838
Cost of revenue	456		456			719		824
Gross profit	1,569		1,458			2,966		3,014
Operating expenses:
Research and development	648		602			1,277		1,198
Marketing and sales	272		280			477		509
General and administrative	197		173			377		336
Amortization of intangibles	17		24			34		49
Restructuring	51		2			53		3
Total operating expenses	1,185		1,081			2,218		2,095
Operating income	384		377			748		919
Interest and other income (expense), net	15		14			45		28
Income before provision for (benefit from) income taxes	399		391			793		947
Provision for (benefit from) income taxes	105		(8	)		219		146
Net income	294		399			574		801
Earnings per share
Basic	1.11		1.47			2.17		2.94
Diluted	1.11		1.47			2.15		2.93
Number of shares used in computation
Basic	264		271			265		272
Diluted	266		272			267		273

Results (in $ millions, except per share data)

The following table reports the variance of the actuals versus our guidance provided on July 30, 2024 for the three months ended September 30, 2024 plus a comparison to the actuals for the three months ended September 30, 2023.

	Three Months Ended September 30,
	2024 Guidance (Mid-Point)						2024 Actuals			2023 Actuals
				Variance
Net revenue
Net revenue	1,950			75			2,025			1,914
GAAP-based financial data
Change in deferred net revenue (online-enabled games)1	50			4			54			(94	)
Cost of revenue
Cost of revenue	435			21			456			456
GAAP-based financial data
Acquisition-related expenses	(10	)		—			(10	)		(15	)
Stock-based compensation	(5	)		1			(4	)		(2	)
Operating expenses
Operating expenses	1,195			(10	)		1,185			1,081
GAAP-based financial data
Acquisition-related expenses	(20	)		3			(17	)		(24	)
Restructuring and related charges	(65	)		13			(52	)		—
Stock-based compensation	(160	)		(10	)		(170	)		(153	)
Income before tax
Income before tax	333			66			399			391
GAAP-based financial data
Acquisition-related expenses	30			(3	)		27			39
Change in deferred net revenue (online-enabled games)1	50			4			54			(94	)
Restructuring and related charges	65			(13	)		52			—
Stock-based compensation	165			9			174			155
Tax rate used for management reporting	19	%					19	%		19	%
Earnings per share
Basic	0.86			0.25			1.11			1.47
Diluted	0.85			0.26			1.11			1.47
Number of shares used in computation
Basic	265			(1	)		264			271
Diluted	267			(1	)		266			272

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)
	September 30, 2024			March 31, 20242
ASSETS
Current assets:
Cash and cash equivalents	2,197			2,900
Short-term investments	366			362
Receivables, net	1,012			565
Other current assets	397			420
Total current assets	3,972			4,247
Property and equipment, net	578			578
Goodwill	5,381			5,379
Acquisition-related intangibles, net	346			400
Deferred income taxes, net	2,431			2,380
Other assets	428			436
TOTAL ASSETS	13,136			13,420
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable, accrued, and other current liabilities	1,312			1,276
Deferred net revenue (online-enabled games)	1,475			1,814
Total current liabilities	2,787			3,090
Senior notes, net	1,883			1,882
Income tax obligations	552			497
Other liabilities	506			438
Total liabilities	5,728			5,907
Stockholders’ equity:
Common stock	3			3
Retained earnings	7,520			7,582
Accumulated other comprehensive loss	(115	)		(72	)
Total stockholders’ equity	7,408			7,513
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	13,136			13,420

²Derived from audited consolidated financial statements.

ELECTRONIC ARTS INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Cash Flows
(in $ millions)
	Three Months Ended September 30,						Six Months Ended September 30,
	2024			2023			2024			2023
OPERATING ACTIVITIES
Net income	294			399			574			801
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization, accretion and impairment	122			85			202			173
Stock-based compensation	174			155			317			285
Change in assets and liabilities
Receivables, net	(579	)		(534	)		(447	)		(367	)
Other assets	(78	)		(22	)		(20	)		74
Accounts payable, accrued, and other liabilities	275			(90	)		117			(200	)
Deferred income taxes, net	(37	)		201			(50	)		108
Deferred net revenue (online-enabled games)	63			(82	)		(339	)		(403	)
Net cash provided by operating activities	234			112			354			471
INVESTING ACTIVITIES
Capital expenditures	(50	)		(51	)		(117	)		(96	)
Proceeds from maturities and sales of short-term investments	111			151			239			302
Purchase of short-term investments	(107	)		(163	)		(237	)		(313	)
Net cash used in investing activities	(46	)		(63	)		(115	)		(107	)
FINANCING ACTIVITIES
Proceeds from issuance of common stock	42			40			42			40
Cash dividends paid	(51	)		(51	)		(101	)		(103	)
Cash paid to taxing authorities for shares withheld from employees	(18	)		(15	)		(139	)		(120	)
Common stock repurchases	(375	)		(325	)		(750	)		(650	)
Net cash used in financing activities	(402	)		(351	)		(948	)		(833	)
Effect of foreign exchange on cash and cash equivalents	11			(11	)		6			(9	)
Change in cash and cash equivalents	(203	)		(313	)		(703	)		(478	)
Beginning cash and cash equivalents	2,400			2,259			2,900			2,424
Ending cash and cash equivalents	2,197			1,946			2,197			1,946

ELECTRONIC ARTS INC. AND SUBSIDIARIES
Unaudited Supplemental Financial Information and Business Metrics
(in $ millions, except per share data)
	Q2			Q3			Q4			Q1			Q2			YOY %
	FY24			FY24			FY24			FY25			FY25			Change
Net revenue
Net revenue	1,914			1,945			1,779			1,660			2,025			6	%
GAAP-based financial data
Change in deferred net revenue (online-enabled games)1	(94	)		421			(113	)		(398	)		54
Gross profit
Gross profit	1,458			1,416			1,422			1,397			1,569			8	%
Gross profit (as a % of net revenue)	76	%		73	%		80	%		84	%		78	%
GAAP-based financial data
Acquisition-related expenses	15			16			29			10			10
Change in deferred net revenue (online-enabled games)1	(94	)		421			(113	)		(398	)		54
Stock-based compensation	2			2			2			4			4
Operating income
Operating income	377			365			234			364			384			2	%
Operating income (as a % of net revenue)	20	%		19	%		13	%		22	%		19	%
GAAP-based financial data
Acquisition-related expenses	39			37			101			27			27
Change in deferred net revenue (online-enabled games)1	(94	)		421			(113	)		(398	)		54
Restructuring and related charges	—			—			61			6			52
Stock-based compensation	155			151			148			143			174
Net income
Net income	399			290			182			280			294			(26	%)
Net income (as a % of net revenue)	21	%		15	%		10	%		17	%		15	%
GAAP-based financial data
Acquisition-related expenses	39			37			101			27			27
Change in deferred net revenue (online-enabled games)1	(94	)		421			(113	)		(398	)		54
Restructuring and related charges	—			—			61			6			52
Stock-based compensation	155			151			148			143			174
Tax rate used for management reporting	19	%		19	%		19	%		19	%		19	%
Diluted earnings per share	1.47			1.07			0.67			1.04			1.11			(24	%)
Number of shares used in computation
Basic	271			269			267			266			264
Diluted	272			271			270			268			266

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)
		Q2			Q3			Q4			Q1			Q2			YOY %
		FY24			FY24			FY24			FY25			FY25			Change
QUARTERLY NET REVENUE PRESENTATIONS
Net revenue by composition
Full game downloads		346			431			265			190			475			37	%
Packaged goods		275			187			68			60			241			(12	%)
Full game		621			618			333			250			716			15	%
Live services and other		1,293			1,327			1,446			1,410			1,309			1	%
Total net revenue		1,914			1,945			1,779			1,660			2,025			6	%
Full game		32	%		32	%		19	%		15	%		35	%
Live services and other		68	%		68	%		81	%		85	%		65	%
Total net revenue %		100	%		100	%		100	%		100	%		100	%
GAAP-based financial data
Full game downloads		24			32			(37	)		(47	)		70
Packaged goods		46			4			(37	)		(35	)		46
Full game		70			36			(74	)		(82	)		116
Live services and other		(164	)		385			(39	)		(316	)		(62	)
Total change in deferred net revenue (online-enabled games) by composition1		(94	)		421			(113	)		(398	)		54
Net revenue by platform
Console		1,187			1,229			1,049			1,005			1,374			16	%
PC & Other		423			420			423			365			364			(14	%)
Mobile		304			296			307			290			287			(6	%)
Total net revenue		1,914			1,945			1,779			1,660			2,025			6	%
GAAP-based financial data
Console		(35	)		377			(94	)		(328	)		108
PC & Other		(34	)		33			(10	)		(70	)		(37	)
Mobile		(25	)		11			(9	)		—			(17	)
Total change in deferred net revenue (online-enabled games) by platform1		(94	)		421			(113	)		(398	)		54

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)
	Q2			Q3			Q4			Q1			Q2			YOY %
	FY24			FY24			FY24			FY25			FY25			Change
CASH FLOW DATA
Investing cash flow	(63	)		(51	)		(49	)		(69	)		(46	)
Investing cash flow - TTM	(205	)		(195	)		(207	)		(232	)		(215	)		(5	%)
Financing cash flow	(351	)		(431	)		(360	)		(546	)		(402	)
Financing cash flow - TTM	(1,609	)		(1,622	)		(1,624	)		(1,688	)		(1,739	)		(8	%)
Operating cash flow	112			1,264			580			120			234
Operating cash flow - TTM	2,211			2,352			2,315			2,076			2,198			(1	%)
Capital expenditures	51			52			51			67			50
Capital expenditures - TTM	191			195			199			221			220			15	%
Free cash flow3	61			1,212			529			53			184
Free cash flow3 - TTM	2,020			2,157			2,116			1,855			1,978			(2	%)
Common stock repurchases	325			325			325			375			375			15	%
Cash dividends paid	51			51			51			50			51			—
DEPRECIATION
Depreciation expense	49			48			50			51			51			4	%
BALANCE SHEET DATA
Cash and cash equivalents	1,946			2,742			2,900			2,400			2,197
Short-term investments	359			362			362			366			366
Cash and cash equivalents, and short-term investments	2,305			3,104			3,262			2,766			2,563			11	%
Receivables, net	1,047			867			565			433			1,012			(3	%)
STOCK-BASED COMPENSATION
Cost of revenue	2			2			2			4			4
Research and development	113			108			104			101			122
Marketing and sales	13			14			14			12			16
General and administrative	27			27			28			26			32
Total stock-based compensation	155			151			148			143			174
RESTRUCTURING AND RELATED CHARGES
Restructuring	2			—			59			2			51
Office space reductions	(2	)		—			2			4			1
Total restructuring and related charges	—			—			61			6			52

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 three months ended September 30, 2024 plus a comparison to the actuals for the three months ended September 30, 2023.
	Three Months Ended
	September 30,
	2024		2023		YOY % Change
Net revenue	2,025		1,914		6%
GAAP operating income	384		377		2%
Acquisition-related expenses	27		39
Restructuring and related charges	52		—
Stock-based compensation	174		155
Non-GAAP operating income	637		571		12%
GAAP operating margin	19.0%		19.7%
Non-GAAP operating margin	31.5%		29.8%
Impact from change in deferred net revenue (online-enabled games)	170 bps		(360) bps

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 FY25 guidance.
	Twelve Months Ending March 31, 2025
	GAAP-Based Financial Data														GAAP-Based Financial Data
		A			B		C		D
	GAAP Guidance Range				Acquisition-related expenses5		Restructuring and related charges5		Stock-based compensation5		Non-GAAP Guidance Range = A + B +C + D				Change in deferred net revenue (online-enabled games)5
Net revenue	7,400	to	7,700		—		—		—		7,400	to	7,700		100
Cost of revenue	1,530	to	1,560		(40)		—		(15)		1,475	to	1,505		—
Operating expense	4,445	to	4,515		(70)		(80)		(640)		3,655	to	3,725		—
Operating margin	19.3%	to	21.1%		150 bps		110 bps		870 bps		30.7%	to	32.1%		90 bps to 80 bps
Income before provision for income taxes	1,477	to	1,676		110		80		655		2,322	to	2,521		100
Net income4	1,019	to	1,156
Number of shares used in computation:
Diluted	267

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 Q3 FY25 guidance.
	Three Months Ending December 31, 2024
	GAAP-Based Financial Data
	GAAP Guidance Range				Acquisition-related expenses		Restructuring and related charges		Stock-based compensation		Change in deferred net revenue (online-enabled games)
Net revenue	1,875	to	2,025		—		—		—		525
Cost of revenue	450	to	480		(10)		—		(5)		—
Operating expense	1,100	to	1,150		(20)		(5)		(165)		—
Income before provision for income taxes	338	to	403		30		5		170		525
Net income4	226	to	270
Number of shares used in computation:
Diluted	266

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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241029337900/en/

Andrew Uerkwitz

Vice President, Investor Relations

650-674-7191

auerkwitz@ea.com



Justin Higgs

Vice President, Corporate Communications

925-502-9253

jhiggs@ea.com

Source: Electronic Arts

FAQ

What were EA's Q2 FY25 net bookings?

EA reported record Q2 net bookings of $2.079 billion, exceeding their guidance range of $2.050 billion.

How much did EA's stock buyback program cost in Q2 FY25?

EA repurchased 2.6 million shares for $375 million during Q2 FY25.

What is EA's quarterly dividend for Q2 FY25?

EA declared a quarterly cash dividend of $0.19 per share, payable on December 18, 2024.

What is EA's revenue forecast for FY25?

EA expects net revenue to be between $7.400 billion to $7.700 billion for FY25.