Free Post Earnings Research Report: Electronic Arts’ Net Revenue Rose 7%; Net Loss Narrowed
Stock Monitor: Take-Two Interactive Software Post Earnings Reporting
LONDON, UK / ACCESSWIRE / December 05, 2017 / Active-Investors free earnings report on Electronic Arts Inc. (NASDAQ: EA) has freshly been issued to its members, and you can also sign up to view this report at www.active-investors.com/registration-sg/?symbol=EA. The Company reported its second quarter fiscal 2018 operating results on October 31, 2017. The video game publisher surpassed earnings expectations, and raised its guidance for earnings, operating cash flow, and net bookings for the fiscal year. Register today and get free access to our complimentary member's area where many more reports are available:
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Active-Investors.com is focused on giving you timely information and the inside line on companies that matter to you. This morning, Electronic Arts most recent news is on our radar and we have decided to include it on our blog post. Today's free coverage is available at:
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Earnings Highlights and Summary
For the three months ended September 30, 2017, Electronic Arts' net revenue was $959 million, up 7% compared to $898 million in Q3 FY16. The Company's net bookings were $1.18 billion for Q2 FY18, up $81 million from the prior year's same quarter, and $19 million above the Company's guidance, and also in-line with market expectations of $1.18 billion.
For Q2 FY18, Electronic Arts' operating expenses were $611 million compared to $546 million in Q2 FY17, and $27 million lower than the Company's guidance, driven by the phasing of Electronic Arts' marketing investment.
Electronic Arts' GAAP operating loss was $41 million versus an operating loss of $49 million in the year-ago comparable period. The Company's GAAP net loss was $22 million, or $0.07 per share, for the reported quarter compared to a net loss of $38 million, or $0.13 per share, in Q2 FY17. On an adjusted basis, the Company reported earnings of $0.66 per share, which were ahead of Wall Street's estimates of $0.54 per share.
Operating Results
Electronic Arts' digital net bookings were $579 million for the reported quarter, up 19% compared to the year-ago same period, and which was a new record for the second quarter. The main drivers of the increase were Battlefield 1, Ultimate Team, and Madden NFL 18 full game downloads. Digital net bookings now represent 63% of the Company's business on a trailing twelve-month basis compared to 57% in Q2 FY17.
For Q2 FY18, Electronic Arts' live services net bookings were up 22% to $310 million y-o-y. The increase was driven by a strong growth in FIFA and Madden Ultimate Team, and in Battlefield 1, FIFA Online 3 in Asia, and The Sims 4. The Company's mobile delivered net bookings were $150 million, up 9% y-o-y. This was a Q2 record and drove the trailing twelve-month net bookings to a new high. The growth was primarily from Star Wars Galaxy of Heroes and Madden Mobile.
During Q2 FY18, Electronic Arts' full game PC and console downloads generated net bookings of $119 million, 28% higher than last year, driven by Madden NFL and Battlefield 1. 36% of the Company's unit sales were digital rather than physical, measured on Xbox One and PlayStation 4 over the last twelve months. This compares to just 30% a year ago.
Cash Matters
Electronic Arts' operating cash flow was $52 million for Q2 FY18, down $70 million from last year. The decrease was driven by the timing of collections. In contrast, the Company's operating cash flow for the trailing twelve months was $1.80 billion, representing its strongest-ever performance measured at the end of the second quarter, and $479 million above last year's comparable period. The Company's capital expenditure was $30 million for Q2 FY18, resulting in a free cash flow of $22 million.
During Q2 FY18, Electronic Arts repurchased 1.3 million shares at a cost of $153 million, leaving $928 million in the Company's two-year $1.2 billion buyback program that began in May 2017. Electronic Arts' cash and short-term investments were $4.4 billion as of September 30, 2017, with 35% of this balance held onshore.
Outlook
The Company reiterated its full-year GAAP revenue forecasts of $5.075 billion. However, the Company raised its earnings per share guidance for the full year to $3.63, and operating cash flow guidance from $1.575 billion to $1.6 billion. Electronic Arts also raised its guidance for net bookings from $5.100 billion to $5.150 billion, driven by strength in the Ultimate Team application.
For Q3 FY18, Electronic Arts expects net revenues to be $1.135 billion; cost of revenues to be $521 million; operating expenses to be $690 million; and loss per share to be $0.21. The Company anticipates net bookings to be $2 billion for the upcoming quarter.
Stock Performance Snapshot
December 04, 2017 - At Monday's closing bell, Electronic Arts' stock declined 4.90%, ending the trading session at $100.83.
Volume traded for the day: 6.51 million shares, which was above the 3-month average volume of 3.06 million shares.
Stock performance in the last twelve-month period – up 32.92%; and year-to-date – up 28.02%
After yesterday's close, Electronic Arts' market cap was at $31.16 billion.
Price to Earnings (P/E) ratio was at 26.63.
The stock is part of the Technology sector, categorized under the Multimedia & Graphics Software industry.
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