Electronic Arts Exceeded Market Expectations For The Q3



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Electronic Arts released its holiday quarter earnings call with better than expected results.

Electronic Arts released its holiday quarter earnings call which revealed better than expected results as the game publisher’s latest products had mixed reviews.

EA or Electronic Arts Inc. is a video game company. It is based in Redwood City, California. Founded in 1982, the company is considered a pioneer. It is amongst the first to represent the home computer games industry.

Electronic Arts is one of the largest gaming companies by revenue in the world. It is the second biggest U.S. game publishing company by market value. The company publishes and develops various games.

It also owns and operates several major gaming studios. EA Tiburon or BioWare are just a few examples. EA is behind games such as FIFA, Battlefield, Need for Speed, and The Sims. And this is just to state a few.

On January 31, the company released its quarter earnings call. They were quite an expected event. Over the holiday quarter, Electronic Arts released two new games. But this garnered mixed reviews.

Nonetheless, the company revealed a 7 percent revenue gain. EA offered some additional details. According to the release, “Battlefield 1” sales exceeded expectations. At the same time, “Titanfall 2” sales were lower than expected.

Both games were released in the same month. Available since October 2016, they both target the first-person shooter game segment. In its earnings call, EA did not reveal how many copies were sold for each game.

The earnings call targeted EA’s third fiscal quarter. This ended on December 31, 2016. Electronic Arts went to explain its game reviews. It pointed out the stiff gaming market competition. In early November, its main competitor also released a shooter game. Activision Blizzard is the largest U.S. gaming company by market value.

For the Q3, EA revealed a $1.15 billion revenue. This slightly exceeded even the company estimates. The same quarter last year had a $1.07 billion revenue.

Electronic Arts also registered a lower loss. This was narrowed down to $1 million. Last year, the company had a $45 million loss.

Both digital and mobile revenue values registered rises. The digital revenue amounted to $685 million. This marks a 20 percent growth compared to last year. Mobile revenue amounted to a total of $147 million. It also rose by 16 percent.

Last year, Electronic Arts stopped reporting adjusted financial figures. But based on the released data, analysts estimated as follows. The Q3 adjusted sales are estimated to have increased by 15 percent. Adjusted profit rates rose to $2.48 per share. This marks a 36 percent increase.

Both values exceeded market expectations. Analysts were estimating an adjusted revenue of $1.13 billion. Approximations placed the per share value at around $2.30.

Electronic Arts also announced its expectations for the current quarter. Its estimated revenue was placed at around $1.48 billion. An estimated per share earning value could each $1.64. These are the expectations for the fourth fiscal quarter. This will end on March 31, 2017.

However, the market is not expecting any big changes. Usually, this is a quiet period in the industry. Still, EA is planning on releasing a new game. “Mass Effect” should become available sometime towards the end of the Q4.

The company did not raise its full-year revenue outlook. This was maintained at $4.8 billion. EA reported concerns about possible foreign-exchange rates. Though, the company did increase its projected per-share value. Its earnings a share could reach $2.91. Previously, the estimated sum reached a total of $2.69.

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