Electronic Arts (EA) Rebounds on Reaffirmed Guidance Despite Battlefield 2042 Delay, Be Concerned But Not Worried Says Analyst
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Shares of Electronic Arts (NASDAQ: EA) are up over 2% in pre-open Thursday after the entertainment company changed the launch date of Battlefield 2042, which will now release worldwide on November 19.
The stock closed 5.73% lower yesterday on rumors the video game launch will be pushed back from the initial date of October 22.
“Building the next generation of Battlefield during a global pandemic has created unforeseen challenges for our development teams. Given the scale and scope of the game, we had hoped our teams would be back in our studios together as we move towards launch. With the ongoing conditions not allowing that to happen safely, and with all the hard work the teams are doing from home, we feel it is important to take the extra time to deliver on the vision of Battlefield 2042 for our players,” said DICE Studio GM Oskar Gabrielson.
The company reiterated its net bookings guidance for the fiscal year 2022 communicated last month, despite the video game launch delay.
Oppenheimer analyst Martin Yang urges investors to be concerned but not worried as the delay “disrupts otherwise near perfect flow since its reveal early June.”
“BF2042 does not have the luxury of CoD Warzone's massive player base or Halo Infinite's immediate attention from Xbox Game Pass subscribers. BF2042 needs a strong momentum (both media attention and player engagement) at launch to help live services to gain traction. The delay may subject BF2042 to more critical eyes in November,” Yang said in a client note.
“While the delay prevented BF2042 from having a "perfectly executed" launch, we believe the game still has differentiated ways to drive player engagement in the medium term, namely, Hazard Zone mode and BF Mobile. BF2042 could leverage those content to gain active players from other mainstream shooter games now that competition happens on (battle pass) seasonal basis.”
Oppenheimer rates EA as Outperform with a $165.00 per share price target.
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