Electronic Arts Reports Strong Q3 FY21 Financial Results

February 2, 2021 4:01 PM EST

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REDWOOD CITY, Calif.--(BUSINESS WIRE)-- Electronic Arts Inc. (NASDAQ: EA) today announced preliminary financial results for its third fiscal quarter ended December 31, 2020.

“We’re bringing great entertainment to hundreds of millions of people all over the world,” said CEO Andrew Wilson. “Our amazing teams continue to deliver exceptional, high-quality experiences as more players connect with their friends and engage deeply with our games. With our expansion plans for EA SPORTS, strong catalogue of owned IP, leading live services, and ability to span every platform, we are growing to reach an even larger audience.”

“We delivered another strong quarter, driven by live services outperformance in Ultimate Team and Apex Legends,” said COO and CFO Blake Jorgensen. “We are raising our net bookings outlook for the full year on the strength we continue to see in our business. Looking further ahead, even with the upside this year, we anticipate delivering growth in fiscal 2022, driven by the next Battlefield.”

EA has posted a slide presentation and a financial model of EA’s historical results and guidance on EA’s IR website at www.ir.ea.com. EA will also post the prepared remarks and a transcript from the conference call on EA’s IR website. News and ongoing updates regarding EA and its games are available on EA’s blog at www.ea.com/news.

Selected Operating Highlights and Metrics

  • Net bookings* for the trailing twelve months was $5.956 billion, up 8% year-over-year.
  • Launched FIFA 21, Medal of HonorTM: Above and Beyond, Need for SpeedTM Hot Pursuit Remastered, and NHL 21 during the quarter.
  • Launched FIFA 21 and Madden NFL 21 on next generation consoles during the quarter.
  • Over the past fiscal year, EA SPORTSTM franchises have engaged more than 230 million people.
  • FIFA Ultimate TeamTM had a record of nearly 6 million daily active players in December.
  • Apex LegendsTM had 30% growth in new players, year-over-year.
  • The SimsTM 4, life to date, has more than 33 million players and reached record daily, weekly, and monthly average players in December.

* 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.

Selected Financial Highlights and Metrics

  • Net cash provided by operating activities was $1.124 billion for the quarter and a record $2.061 billion for the trailing twelve months.
  • EA repurchased 2.5 million shares for $326 million during the quarter, bringing the total for the last twelve months to 5.9 million shares for $695 million.
  • EA paid a cash dividend of $0.17 per share during the quarter.

Dividend

EA has declared a quarterly cash dividend of $0.17 per share of the Company’s common stock. The dividend is payable on March 24, 2021 to shareholders of record as of the close of business on March 3, 2021.

Quarterly Financial Highlights

Three Months Ended
December 31,

2020

2019

(in $ millions, except per share amounts)
Full game

722

689

Live services and other

951

904

Total net revenue

1,673

1,593

 
Net income

211

346

Diluted earnings per share

0.72

1.18

 
Operating cash flow

1,124

1,104

 
Value of shares repurchased

326

305

Number of shares repurchased

2.5

3.1

The following GAAP-based financial data and tax rate of 18% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results:

Three Months Ended December 31, 2020
GAAP-Based Financial Data
(in $ millions) Statement of
Operations
Acquisition-
related
expenses
Change in
deferred net
revenue
(online-
enabled
games)
Stock-based
compensation
Total net revenue

1,673

 

-

 

727

-

 

Cost of revenue

601

 

-

 

-

(1

)

Gross profit

1,072

 

-

 

727

1

 

Total operating expenses

821

 

(5

)

-

(110

)

Operating income

251

 

5

 

727

111

 

Interest and other income, net

(6

)

-

 

-

-

 

Income before provision for income taxes

245

 

5

 

727

111

 

Number of shares used in computation:
Diluted

292

 

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, 2020.

Financial Highlights for the Trailing Twelve Months

Twelve Months Ended
December 31,

2020

2019

(in $ millions)
Full game

1,719

1,838

Live services and other

3,951

3,550

Total net revenue

5,670

5,388

 
Net income

1,179

*2,830
 
Operating cash flow

2,061

1,898

 
Value of shares repurchased

695

1,217

Number of shares repurchased

5.9

12.8

 
*Includes the impact of one-time tax benefits recognized during the period.

The following GAAP-based financial data and tax rate of 18% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results:

Twelve Months Ended December 31, 2020
GAAP-Based Financial Data
(in $ millions) Statement of
Operations
Acquisition-
related
expenses
Change in
deferred net
revenue
(online-
enabled
games)
Stock-based
compensation
Total net revenue

5,670

 

-

 

286

-

 

Cost of revenue

1,444

 

(3

)

-

(5

)

Gross profit

4,226

 

3

 

286

5

 

Total operating expenses

2,954

 

(22

)

-

(412

)

Operating income

1,272

 

25

 

286

417

 

Interest and other income, net

(6

)

-

 

-

-

 

Income before provision for income taxes

1,266

 

25

 

286

417

 

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, 2020.

Operating Metric

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

Three Months Ended Twelve Months Ended
December 31, December 31,

2020

2019* 2020* 2019*
(in $ millions)
Total net revenue

1,673

1,593

5,670

5,388

Change in deferred net revenue (online-enabled games)

727

428

286

139

Net bookings

2,400

2,021

5,956

5,527

 
*At the beginning of FY21, EA changed the way in which it presents net bookings. Periods prior to the first quarter of FY21 have been recast for comparability to align with these changes. For more information, please see the Financial Reporting FAQ on our IR website.

Business Outlook as of February 2, 2021

The following forward-looking statements reflect expectations as of February 2, 2021. Electronic Arts assumes no obligation to update these statements. Results may be materially different and are affected by many factors detailed in this release and in EA’s annual and quarterly SEC filings.

Fiscal Year 2021 Expectations – Ending March 31, 2021

Financial metrics:

  • Net revenue is expected to be approximately $5.600 billion.
    • Change in deferred net revenue (online-enabled games) is expected to be approximately $475 million.
  • Net income is expected to be approximately $742 million.
  • Diluted earnings per share is expected to be approximately $2.54.
  • Operating cash flow is expected to be approximately $1.850 billion.
  • The Company estimates a share count of 292 million for purposes of calculating fiscal year 2021 diluted earnings per share.

Operational metric:

  • Net bookings is expected to be approximately $6.075 billion.

In addition, the following outlook for GAAP-based financial data and a long-term tax rate of 18% are used internally by EA to adjust our GAAP expectations to assess EA’s operating results and plan for future periods:

Twelve Months Ending March 31, 2021
GAAP-Based Financial Data
GAAP
Guidance
Acquisition-
related
expenses
Change in
deferred net
revenue (online-
enabled games)
Stock-based
compensation
(in $ millions)
Total net revenue

5,600

-

 

475

-

 

Cost of revenue

1,477

-

 

-

(4

)

Operating expense

3,074

(20

)

-

(436

)

Income before provision for income taxes

1,024

20

 

475

440

 

Net income

742

Number of shares used in computation:
Diluted shares

292

Fourth Quarter Fiscal Year 2021 Expectations – Ending March 31, 2021

Financial metrics:

  • Net revenue is expected to be approximately $1.317 billion.
    • Change in deferred net revenue (online-enabled games) is expected to be approximately $58 million.
  • Net loss is expected to be approximately ($19) million; this forecast includes the impact of an incremental tax accounting charge of ($152) million.
  • Loss per share is expected to be approximately ($0.07), which includes ($0.52) per share from the tax accounting charge.
  • The Company estimates a GAAP basic and diluted share count of 289 million shares due to a forecasted net loss. If the Company reports net income instead of a net loss, diluted share count for calculating diluted earnings per share would be 292 million shares.

Operational metric:

  • Net bookings is expected to be approximately $1.375 billion.

In addition, the following outlook for GAAP-based financial data and a long-term tax rate of 18% are used internally by EA to adjust our GAAP expectations to assess EA’s operating results and plan for future periods:

Three Months Ending March 31, 2021
GAAP-Based Financial Data
GAAP
Guidance
Acquisition-
related
expenses
Change in
deferred net
revenue (online-
enabled games)
Stock-based
compensation
(in $ millions)
Total net revenue

1,317

 

-

 

58

-

 

Cost of revenue

302

 

-

 

-

-

 

Operating expense

837

 

(4

)

-

(114

)

Income before provision for income taxes

172

 

4

 

58

114

 

Net loss

(19

)

Number of shares used in computation:
Basic shares

289

 

Diluted shares

292

 

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, 2020.

Conference Call and Supporting Documents

Electronic Arts will host a conference call on February 2, 2021 at 2:00 pm PT (5:00 pm ET) to review its results for the third fiscal quarter ended December 31, 2020 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 (866) 324-3683 (domestic) or (509) 844-0959 (international), using the conference code 3695237 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 February 16, 2021 at 855-859-2056 (domestic) or 404-537-3406 (international) using pin code 3695237. 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 fiscal 2021 expectations under the heading “Business Outlook as of February 2, 2021,” and other information regarding EA's fiscal 2021 and fiscal 2022 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: the impact of the COVID-19 pandemic, 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 acquisitions; the consumer demand for, and the availability of an adequate supply of console hardware units; the Company’s ability to predict consumer preferences among competing platforms; the Company’s ability to develop and implement new technology; foreign currency exchange rate fluctuations; general economic 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, 2020.

These forward-looking statements are current as of February 2, 2021. 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 December 31, 2020. 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 December 31, 2020.

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 2020, EA posted GAAP net revenue of $5.5 billion. Headquartered in Redwood City, California, EA is recognized for a portfolio of critically acclaimed, high-quality brands such as EA SPORTS™ FIFA, Battlefield™, Apex Legends™, The Sims™, Madden NFL, Need for Speed™, Titanfall™ and Plants vs. Zombies™. More information about EA is available at www.ea.com/news.

EA SPORTS, Medal of Honor, Ultimate Team, Battlefield, Need for Speed, Apex Legends, The Sims, Titanfall and Plants vs. Zombies are trademarks of Electronic Arts Inc. John Madden, NFL, and FIFA are the property of their respective owners and used with permission.

ELECTRONIC ARTS INC. AND SUBSIDIARIES

Unaudited Condensed Consolidated Statements of Operations

(in $ millions, except per share data)

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

December 31,

 

December 31,

 

2020

 

2019

 

2020

 

2019

Net revenue

1,673

 

 

1,593

 

4,283

 

 

4,150

 

Cost of revenue

601

 

 

508

 

1,175

 

 

1,100

 

Gross profit

1,072

 

 

1,085

 

3,108

 

 

3,050

 

Operating expenses:

 

 

 

 

 

 

 

Research and development

451

 

 

389

 

1,310

 

 

1,157

 

Marketing and sales

216

 

 

202

 

493

 

 

464

 

General and administrative

149

 

 

126

 

418

 

 

364

 

Acquisition-related contingent consideration

 

 

2

 

 

 

5

 

Amortization of intangibles

5

 

 

5

 

16

 

 

16

 

Total operating expenses

821

 

 

724

 

2,237

 

 

2,006

 

Operating income

251

 

 

361

 

871

 

 

1,044

 

Interest and other income (expense), net

(6

)

 

13

 

(19

)

 

50

 

Income before provision for (benefit from) income taxes

245

 

 

374

 

852

 

 

1,094

 

Provision for (benefit from) income taxes

34

 

 

28

 

91

 

 

(1,527

)

Net income

211

 

 

346

 

761

 

 

2,621

 

Earnings per share

 

 

 

 

 

 

 

Basic

0.73

 

 

1.18

 

2.63

 

 

8.91

 

Diluted

0.72

 

 

1.18

 

2.61

 

 

8.85

 

Number of shares used in computation

 

 

 

 

 

 

 

Basic

290

 

 

292

 

289

 

 

294

 

Diluted

292

 

 

294

 

292

 

 

296

 

Results (in $ millions, except per share data)

The following table reports the variance of the actuals versus our guidance provided on November 5, 2020 for the three months ended December 31, 2020 plus a comparison to the actuals for the three months ended December 31, 2019.

 

Three Months Ended December 31,

 

2020

 

 

 

2020

 

2019

 

Guidance

 

Variance

 

Actuals

 

Actuals

Net revenue

 

 

 

 

 

 

 

Net revenue

1,675

 

 

(2

)

 

1,673

 

 

1,593

 

GAAP-based financial data

 

 

 

 

 

 

 

Change in deferred net revenue (online-enabled games)1

675

 

 

52

 

 

727

 

 

428

 

Cost of revenue

 

 

 

 

 

 

 

Cost of revenue

599

 

 

2

 

 

601

 

 

508

 

GAAP-based financial data

 

 

 

 

 

 

 

Acquisition-related expenses

 

 

 

 

 

 

(5

)

Stock-based compensation

 

 

(1

)

 

(1

)

 

(1

)

Operating expenses

 

 

 

 

 

 

 

Operating expenses

840

 

 

(19

)

 

821

 

 

724

 

GAAP-based financial data

 

 

 

 

 

 

 

Acquisition-related expenses

(5

)

 

 

 

(5

)

 

(7

)

Stock-based compensation

(115

)

 

5

 

 

(110

)

 

(90

)

Income before tax

 

 

 

 

 

 

 

Income before tax

227

 

 

18

 

 

245

 

 

374

 

GAAP-based financial data

 

 

 

 

 

 

 

Acquisition-related expenses

5

 

 

 

 

5

 

 

12

 

Change in deferred net revenue (online-enabled games)1

675

 

 

52

 

 

727

 

 

428

 

Stock-based compensation

115

 

 

(4

)

 

111

 

 

91

 

Tax rate used for management reporting

18

%

 

 

 

18

%

 

18

%

Earnings per share

 

 

 

 

 

 

 

Basic

0.62

 

 

0.11

 

 

0.73

 

 

1.18

 

Diluted

0.61

 

 

0.11

 

 

0.72

 

 

1.18

 

Number of shares

 

 

 

 

 

 

 

Basic

290

 

 

 

 

290

 

 

292

 

Diluted

294

 

 

(2

)

 

292

 

 

294

 

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.

In fiscal 2021, EA changed the way in which it presents net revenue. Periods prior to the first quarter of fiscal 2021 have been recast for comparability to align with these changes. For more information please see the Financial Reporting FAQ on our Investor Relations Website.

ELECTRONIC ARTS INC. AND SUBSIDIARIES

Unaudited Condensed Consolidated Balance Sheets

(in $ millions)

 

 

 

 

 

December 31, 2020

 

March 31, 20202

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

4,772

 

 

3,768

 

Short-term investments

1,938

 

 

1,967

 

Receivables, net

778

 

 

461

 

Other current assets

233

 

 

321

 

Total current assets

7,721

 

 

6,517

 

Property and equipment, net

467

 

 

449

 

Goodwill

1,896

 

 

1,885

 

Acquisition-related intangibles, net

37

 

 

53

 

Deferred income taxes, net

1,924

 

 

1,903

 

Other assets

375

 

 

305

 

TOTAL ASSETS

12,420

 

 

11,112

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

Current liabilities:

 

 

 

Accounts payable

89

 

 

68

 

Accrued and other current liabilities

1,423

 

 

1,052

 

Deferred net revenue (online-enabled games)

1,380

 

 

945

 

Senior notes, current, net

600

 

 

599

 

Total current liabilities

3,492

 

 

2,664

 

Senior notes, net

397

 

 

397

 

Income tax obligations

296

 

 

373

 

Deferred income taxes, net

1

 

 

1

 

Other liabilities

271

 

 

216

 

Total liabilities

4,457

 

 

3,651

 

 

 

 

 

Stockholders’ equity:

 

 

 

Common stock

3

 

 

3

 

Retained earnings

8,054

 

 

7,508

 

Accumulated other comprehensive loss

(94

)

 

(50

)

Total stockholders’ equity

7,963

 

 

7,461

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

12,420

 

 

11,112

 

2Derived from audited consolidated financial statements.

ELECTRONIC ARTS INC. AND SUBSIDIARIES

Unaudited Condensed Consolidated Statements of Cash Flows

(in $ millions)

 

 

 

 

 

 

 

 

 

Three Months Ended
December 31,

 

Nine Months Ended
December 31,

 

2020

 

2019

 

2020

 

2019

OPERATING ACTIVITIES

 

 

 

 

 

 

 

Net income

211

 

 

346

 

 

761

 

 

2,621

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

Depreciation, amortization and accretion

46

 

 

39

 

 

123

 

 

111

 

Stock-based compensation

111

 

 

91

 

 

326

 

 

256

 

Change in assets and liabilities

 

 

 

 

 

 

 

Receivables, net

(348

)

 

59

 

 

(309

)

 

(176

)

Other assets

85

 

 

43

 

 

(28

)

 

76

 

Accounts payable

(77

)

 

(84

)

 

29

 

 

(33

)

Accrued and other liabilities

341

 

 

176

 

 

245

 

 

264

 

Deferred income taxes, net

14

 

 

7

 

 

(18

)

 

(1,793

)

Deferred net revenue (online-enabled games)

741

 

 

427

 

 

434

 

 

(27

)

Net cash provided by operating activities

1,124

 

 

1,104

 

 

1,563

 

 

1,299

 

INVESTING ACTIVITIES

 

 

 

 

 

 

 

Capital expenditures

(30

)

 

(28

)

 

(93

)

 

(100

)

Proceeds from maturities and sales of short-term investments

670

 

 

582

 

 

2,088

 

 

1,375

 

Purchase of short-term investments

(640

)

 

(637

)

 

(2,056

)

 

(2,621

)

Net cash used in investing activities

 

 

(83

)

 

(61

)

 

(1,346

)

FINANCING ACTIVITIES

 

 

 

 

 

 

 

Proceeds from issuance of common stock

13

 

 

1

 

 

56

 

 

34

 

Cash dividends paid

(49

)

 

 

 

(49

)

 

 

Cash paid to taxing authorities for shares withheld from employees

(67

)

 

(31

)

 

(144

)

 

(86

)

Repurchase and retirement of common stock

(326

)

 

(305

)

 

(404

)

 

(916

)

Payment of contingent consideration

 

 

(26

)

 

 

 

(90

)

Net cash used in financing activities

(429

)

 

(361

)

 

(541

)

 

(1,058

)

Effect of foreign exchange on cash and cash equivalents

18

 

 

3

 

 

43

 

 

 

Change in cash and cash equivalents

713

 

 

663

 

 

1,004

 

 

(1,105

)

Beginning cash and cash equivalents

4,059

 

 

2,940

 

 

3,768

 

 

4,708

 

Ending cash and cash equivalents

4,772

 

 

3,603

 

 

4,772

 

 

3,603

 

ELECTRONIC ARTS INC. AND SUBSIDIARIES

Unaudited Supplemental Financial Information and Business Metrics

(in $ millions, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

Q3

 

Q4

 

Q1

 

Q2

 

Q3

 

YOY %

 

FY20

 

FY20

 

FY21

 

FY21

 

FY21

 

Change

Net revenue

 

 

 

 

 

 

 

 

 

 

 

Net revenue

1,593

 

 

1,387

 

 

1,459

 

 

1,151

 

 

1,673

 

 

5

%

GAAP-based financial data

 

 

 

 

 

 

 

 

 

 

 

Change in deferred net revenue (online-enabled games)1

428

 

 

(131

)

 

(69

)

 

(241

)

 

727

 

 

 

Gross profit

 

 

 

 

 

 

 

 

 

 

 

Gross profit

1,085

 

 

1,118

 

 

1,171

 

 

865

 

 

1,072

 

 

(1

%)

Gross profit (as a % of net revenue)

68

%

 

81

%

 

80

%

 

75

%

 

64

%

 

 

GAAP-based financial data

 

 

 

 

 

 

 

 

 

 

 

Acquisition-related expenses

5

 

 

3

 

 

 

 

 

 

 

 

 

Change in deferred net revenue (online-enabled games)1

428

 

 

(131

)

 

(69

)

 

(241

)

 

727

 

 

 

Stock-based compensation

1

 

 

1

 

 

1

 

 

2

 

 

1

 

 

 

Operating income

 

 

 

 

 

 

 

 

 

 

 

Operating income

361

 

 

401

 

 

471

 

 

149

 

 

251

 

 

(30

%)

Operating income (as a % of net revenue)

23

%

 

29

%

 

32

%

 

13

%

 

15

%

 

 

GAAP-based financial data

 

 

 

 

 

 

 

 

 

 

 

Acquisition-related expenses

12

 

 

9

 

 

5

 

 

6

 

 

5

 

 

 

Change in deferred net revenue (online-enabled games)1

428

 

 

(131

)

 

(69

)

 

(241

)

 

727

 

 

 

Stock-based compensation

91

 

 

91

 

 

102

 

 

113

 

 

111

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

Net income

346

 

 

418

 

 

365

 

 

185

 

 

211

 

 

(39

%)

Net income (as a % of net revenue)

22

%

 

30

%

 

25

%

 

16

%

 

13

%

 

 

GAAP-based financial data

 

 

 

 

 

 

 

 

 

 

 

Acquisition-related expenses

12

 

 

9

 

 

5

 

 

6

 

 

5

 

 

 

Change in deferred net revenue (online-enabled games)1

428

 

 

(131

)

 

(69

)

 

(241

)

 

727

 

 

 

Stock-based compensation

91

 

 

91

 

 

102

 

 

113

 

 

111

 

 

 

Tax rate used for management reporting

18

%

 

18

%

 

18

%

 

18

%

 

18

%

 

 

Diluted earnings per share

1.18

 

 

1.43

 

 

1.25

 

 

0.63

 

 

0.72

 

 

(39

%)

Number of diluted shares used in computation

 

 

 

 

 

 

 

 

 

 

 

Basic

292

 

 

290

 

 

288

 

 

289

 

 

290

 

 

 

Diluted

294

 

 

292

 

 

292

 

 

293

 

 

292

 

 

 

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.

In fiscal 2021, EA changed the way in which it presents net revenue. Periods prior to the first quarter of fiscal 2021 have been recast for comparability to align with these changes. For more information please see the Financial Reporting FAQ on our Investor Relations Website.

ELECTRONIC ARTS INC. AND SUBSIDIARIES

Unaudited Supplemental Financial Information and Business Metrics

(in $ millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q3

 

Q4

 

Q1

 

Q2

 

Q3

 

YOY %

 

 

FY20

 

FY20

 

FY21

 

FY21

 

FY21

 

Change

QUARTERLY NET REVENUE PRESENTATIONS

 

 

 

 

 

 

 

 

 

 

 

 

Net revenue by composition

 

 

 

 

 

 

 

 

 

 

 

 

Full game downloads

 

286

 

 

211

 

 

223

 

 

163

 

 

347

 

 

21

%

Packaged goods

 

403

 

 

145

 

 

136

 

 

119

 

 

375

 

 

(7

%)

Full game

 

689

 

 

356

 

 

359

 

 

282

 

 

722

 

 

5

%

Live services and other

 

904

 

 

1,031

 

 

1,100

 

 

869

 

 

951

 

 

5

%

Total net revenue

 

1,593

 

 

1,387

 

 

1,459

 

 

1,151

 

 

1,673

 

 

5

%

Full game

 

43

%

 

26

%

 

25

%

 

25

%

 

43

%

 

 

Live services and other

 

57

%

 

74

%

 

75

%

 

75

%

 

57

%

 

 

Total net revenue %

 

100

%

 

100

%

 

100

%

 

100

%

 

100

%

 

 

GAAP-based financial data

 

 

 

 

 

 

Full game downloads

 

31

 

 

(21

)

 

(5

)

 

(2

)

 

53

 

 

 

Packaged goods

 

60

 

 

(67

)

 

(67

)

 

(14

)

 

83

 

 

 

Full game

 

91

 

 

(88

)

 

(72

)

 

(16

)

 

136

 

 

 

Live services and other

 

337

 

 

(43

)

 

3

 

 

(225

)

 

591

 

 

 

Total change in deferred net revenue (online-enabled games) by composition1

 

428

 

 

(131

)

 

(69

)

 

(241

)

 

727

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net revenue by platform

 

 

 

 

 

 

 

 

 

 

 

 

Console

 

1,163

 

 

928

 

 

932

 

 

714

 

 

1,191

 

 

2

%

PC & Other

 

261

 

 

274

 

 

325

 

 

249

 

 

326

 

 

25

%

Mobile

 

169

 

 

185

 

 

202

 

 

188

 

 

156

 

 

(8

%)

Total net revenue

 

1,593

 

 

1,387

 

 

1,459

 

 

1,151

 

 

1,673

 

 

5

%

GAAP-based financial data

 

 

 

 

 

 

Console

 

388

 

 

(143

)

 

(108

)

 

(201

)

 

619

 

 

 

PC & Other

 

24

 

 

7

 

 

15

 

 

(24

)

 

73

 

 

 

Mobile

 

16

 

 

5

 

 

24

 

 

(16

)

 

35

 

 

 

Total change in deferred net revenue (online-enabled games) by platform1

 

428

 

 

(131

)

 

(69

)

 

(241

)

 

727

 

 

 

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.

In fiscal 2021, EA changed the way in which it presents net revenue. Periods prior to the first quarter of fiscal 2021 have been recast for comparability to align with these changes. For more information please see the Financial Reporting FAQ on our Investor Relations Website.

ELECTRONIC ARTS INC. AND SUBSIDIARIES

Unaudited Supplemental Financial Information and Business Metrics

(in $ millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

Q3

 

Q4

 

Q1

 

Q2

 

Q3

 

YOY %

 

FY20

 

FY20

 

FY21

 

FY21

 

FY21

 

Change

CASH FLOW DATA

 

 

 

 

 

 

 

 

 

 

 

Operating cash flow

1,104

 

498

 

378

 

61

 

1,124

 

2

%

Operating cash flow - TTM

1,898

 

1,797

 

2,017

 

2,041

 

2,061

 

9

%

Capital expenditures

28

 

40

 

38

 

25

 

30

 

7

%

Capital expenditures - TTM

135

 

140

 

133

 

131

 

133

 

(1

%)

Repurchase and retirement of common stock

305

 

291

 

78

 

 

326

 

7

%

Cash dividends paid

 

 

 

 

49

 

100

%

DEPRECIATION

 

 

 

 

 

 

 

 

 

 

 

Depreciation expense

29

 

31

 

31

 

32

 

37

 

28

%

BALANCE SHEET DATA

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

3,603

 

3,768

 

4,013

 

4,059

 

4,772

 

 

Short-term investments

1,999

 

1,967

 

1,947

 

1,972

 

1,938

 

 

Cash and cash equivalents, and short-term investments

5,602

 

5,735

 

5,960

 

6,031

 

6,710

 

20

%

Receivables, net

798

 

461

 

507

 

423

 

778

 

(3

%)

STOCK-BASED COMPENSATION

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

1

 

1

 

1

 

2

 

1

 

 

Research and development

60

 

59

 

66

 

74

 

74

 

 

Marketing and sales

10

 

10

 

11

 

12

 

11

 

 

General and administrative

20

 

21

 

24

 

25

 

25

 

 

Total stock-based compensation

91

 

91

 

102

 

113

 

111

 

 

Category: Company News

Chris Evenden
Vice President, Investor Relations
650-628-0255
cevenden@ea.com

John Reseburg
Vice President, Global Communications
650-628-3601
jreseburg@ea.com

Source: Electronic Arts Inc.



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