Electronic Arts (NASDAQ: EA) reported better-than-expected first quarter results resulting in the stock price inching up 3% after the bell. The company’s stock has recovered 13% this year after touching a new 52-week low mark in late December. However, it has plunged 40% from July last year due to muted performance.
For the fiscal 2020 period, the gaming giant would benefit from a one-time tax benefit of $1.7 billion or $5.61 of EPS. The company recorded $1.08 billion during the Q1 period and expects to take into the account the remaining $620 million in the second quarter.
EA CEO Andrew Wilson talking about the first quarter results said, “From great new games to live services with longevity, subscriptions on more platforms and competitive gaming for more franchises, we’re pushing to lead with innovation, quality and choice for our players.”
EA’s top line rose 6% to $1.2 billion and net bookings declined modestly by 1% to $743 million. Thanks to the one-time tax benefits, earnings per share surged to $4.75 compared to $0.95 reported in the prior year period. Analysts were expecting sales of $719 million and adjusted earnings of 1 cent for the Q1 period.
Digital sales brought in 87% of revenues in the first quarter continuing its momentum from the last quarter. Gaming downloads and live services grew double-digits offset by disappointing performance from the mobile and packaged services.
The company plans to launch the “Star Wars Jedi: Fallen Order” from the Star Wars franchise in November matching with the holiday season.
Outlook Update
EA expects Q2 revenue to come in at $1.315 billion and EPS of $2.60, including tax benefit of $2.08. Net bookings is forecasted to come in at $1.23 billion. For the same period, analysts are expecting sales of $1.24 billion and adjusted earnings of $0.89 per share.
For the fiscal 2020 period, Electronic Arts is expecting revenues of $5.375 billion and GAAP EPS of $9.22, which includes $5.61 as one-time tax benefit. Net bookings is projected at $5.1 billion. On the flip side, the street is anticipating sales of $5.18 billion and adjusted EPS of $4.52 compared to $4.25 reported in the prior year period.
The gaming giant’s sales guidance for both the periods is more or less in line with estimates, but adjusted EPS fell short of expectations.
Electronic Arts’ rival Activision Blizzard (ATVI) is reporting its second quarter results on August 8th while Take-Two Interactive Software (TTWO) is publishing its first quarter earnings on August 5th.
Most Popular
Tyson Foods (TSN) Q2 2024 Earnings: Key financials and quarterly highlights
Tyson Foods, Inc. (NYSE: TSN) reported second quarter 2024 earnings results today. Sales dipped slightly to $13.07 billion from $13.1 billion in the same period a year ago. Net income
After mixed Q2, what awaits Apple (AAPL) in the second half?
Apple’s (NASDAQ: AAPL) stock rallied this week after the gadget giant reported stronger-than-expected Q2 results and announced the largest-ever share buyback program. The company is investing heavily in the business,
What to expect when Tyson Foods (TSN) reports Q2 2024 earnings results
Shares of Tyson Foods, Inc. (NYSE: TSN) stayed green on Friday. The stock has gained 8% over the past three months. The branded foods company is slated to report its
Comments
Comments are closed.