Electronic Arts Reports Strong First Quarter Earnings for FY2024
August 23, 2023
☀️Earnings Overview
On August 1 2023, ELECTRONIC ARTS ($NASDAQ:EA) reported their financial results for the first quarter of FY2024, which ended June 30 2023. Revenue for the quarter had risen 8.9% year-on-year, to USD 1924.0 million, while net income had increased by 29.3% to USD 402.0 million.
Market Price
On Tuesday, Electronic Arts, one of the world’s leading video game companies, reported strong first quarter earnings for fiscal year 2024. This increase was mainly due to higher sales of its best-selling games such as FIFA, Madden NFL, and Apex Legends. ELECTRONIC ARTS stock opened at $135.5 and closed at $136.1 on Tuesday, representing a slight 0.2% decrease from the previous day’s closing price of $136.4.
However, analysts remain positive on the company’s future prospects with many predicting that Electronic Arts’ strong first quarter results will be a sign of continued success throughout the rest of the year. The company also announced plans to begin investing heavily in new technologies and virtual reality projects in order to ensure that its games remain competitive in the increasingly crowded video game market. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Electronic Arts. More…
| Total Revenues | Net Income | Net Margin |
| 7.58k | 893 | 12.7% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Electronic Arts. More…
| Operations | Investing | Financing |
| 1.99k | -196 | -1.61k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Electronic Arts. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 13.08k | 5.75k | 26.95 |
Key Ratios Snapshot
Some of the financial key ratios for Electronic Arts are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 9.4% | 0.9% | 19.6% |
| FCF Margin | ROE | ROA |
| 23.7% | 12.7% | 7.1% |
Analysis
At GoodWhale, we have conducted thorough analysis of the fundamentals of ELECTRONIC ARTS. Our Star Chart shows that ELECTRONIC ARTS has a high health score of 9/10, which indicates that the company is capable of sustaining operations in times of crisis due to its healthy cashflows and debt. Moreover, ELECTRONIC ARTS is strong in terms of profitability and medium in terms of asset, dividend, and growth. Based on our analysis, we classify ELECTRONIC ARTS as a ‘rhino’ type company – one that has achieved moderate revenue or earnings growth. With this type of company, we believe that certain types of investors may be interested. Investors who are looking for steady returns without taking too much risk may be drawn to ELECTRONIC ARTS due to its respectable health score and moderate growth prospects. On the other hand, those who are looking for higher yields or rapid growth may be better suited to other investments. More…
Peers
Electronic Arts Inc is one of the leading game developers in the world. The company has been in operation for over three decades and has released some of the most popular video games in history. Electronic Arts Inc’s main competitors are Take-Two Interactive Software Inc, PlaySide Studios Ltd, and Gumi Inc.
– Take-Two Interactive Software Inc ($NASDAQ:TTWO)
Take-Two Interactive Software Inc is a publicly traded video game holding company based in New York City. The company owns two major publishing labels, Rockstar Games and 2K, itself composed of multiple studios. Its Grand Theft Auto, Red Dead, and NBA 2K franchises are among the most successful and well-known in the video game industry.
– PlaySide Studios Ltd ($ASX:PLY)
Sides Studios Ltd is a publicly traded company with a market capitalization of 215.5 million as of 2022. The company has a return on equity of 7.79%. Side Studios is a leading provider of 3D animation and visual effects for the film and television industry. The company has worked on some of the most popular films and television shows of the past decade, including The Lord of the Rings trilogy, The Chronicles of Narnia, and Game of Thrones.
– Gumi Inc ($TSE:3903)
Gumi Inc is a Japanese company that specializes in the development and publishing of mobile games. The company has a market cap of 27.96B as of 2022 and a Return on Equity of -33.77%. Gumi Inc’s games are available on both iOS and Android devices, and some of their most popular titles include Brave Frontier, Final Fantasy: Brave Exvius, and Attack on Titan: Assault.
Summary
ELECTRONIC ARTS posted strong results for the first quarter of FY2024, with total revenue up 8.9% year-on-year to USD 1924.0 million and net income increasing 29.3% to USD 402.0 million. These figures indicate that the company is performing well and is likely to remain a strong investment option for investors interested in the video game space. The results particularly demonstrate the strength of the mobile gaming sector, which is seeing significant growth in recent years. With strong financials, a wide portfolio of successful titles, and an increasing focus on mobile gaming, ELECTRONIC ARTS is a great choice for investors looking for long term returns.
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