Electronic Arts – Electronic Arts Reports Q2 FY22 Financial Results
Results Above Expectations, Raised Outlook for the Full Year
REDWOOD CITY, Calif.–(BUSINESS WIRE)–
Electronic Arts Inc. (NASDAQ: EA) today announced preliminary financial results for its second fiscal quarter ended September 30, 2021.
“This was the strongest second quarter in the history of Electronic Arts, with more players around the world joining and engaging in our leading franchises, new launches and live services,” said Andrew Wilson, CEO of Electronic Arts. “Thanks to our incredibly talented teams, we’re excited to deliver more amazing experiences this holiday season, and connect hundreds of millions of players around the world through our EA SPORTS games, Apex Legends, Battlefield 2042 and more.”
“EA delivered another strong quarter, primarily driven by our EA SPORTS titles and Apex Legends,” said CFO Blake Jorgensen. “Based on our confidence in our franchises and live services, we are again raising guidance this quarter. We’re positioned for a strong holiday season driven by our exciting Battlefield 2042 game, with growth drivers in place for this year, next year, and beyond.”
Selected Operating Highlights and Metrics
- Net bookings1 for the trailing twelve months was $7.077 billion, up 27% year-over-year.
- In the first six months of the fiscal year, approximately 100 million players have engaged with our EA SPORTS™ global football franchise across all platforms.
- Apex Legends™ Season 9 and Season 10 each respectively set new marks for the highest active players since Season 1.
- The Battlefield™ 2042 Open Beta had 7.7 million players.
- Star Wars™: Galaxy of Heroes surpassed 100 million players life to date.
Selected Financial Highlights and Metrics
- Net cash provided by operating activities was $64 million for the quarter and $1.416 billion for the trailing twelve months.
- EA repurchased 2.3 million shares for $325 million during the quarter, bringing the total for the last twelve months to 9.5 million shares for $1.301 billion.
- 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 December 22, 2021 to shareholders of record as of the close of business on December 8, 2021.
Quarterly Financial Highlights
| Three Months Ended | ||||
| September 30, | ||||
|
2021 |
2020 |
|||
| (in $ millions, except per share amounts) | ||||
| Full game |
617 |
282 |
||
| Live services and other |
1,209 |
869 |
||
| Total net revenue |
1,826 |
1,151 |
||
| Net income |
294 |
185 |
||
| Diluted earnings per share |
1.02 |
0.63 |
||
| Operating cash flow |
64 |
61 |
||
| Value of shares repurchased |
325 |
– |
||
| Number of shares repurchased |
2.3 |
– |
||
The following GAAP-based financial data2 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 September 30, 2021 | |||||||||||
| 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 |
1,826 |
|
– |
|
25 |
– |
|
||||
| Cost of revenue |
494 |
|
(22 |
) |
– |
(2 |
) |
||||
| Gross profit |
1,332 |
|
22 |
|
25 |
2 |
|
||||
| Total operating expenses |
992 |
|
(30 |
) |
– |
(147 |
) |
||||
| Operating income |
340 |
|
52 |
|
25 |
149 |
|
||||
| Interest and other income (expense), net |
(14 |
) |
– |
|
– |
– |
|
||||
| Income before provision for income taxes |
326 |
|
52 |
|
25 |
149 |
|
||||
| Number of shares used in computation: | |||||||||||
| Diluted |
287 |
|
|||||||||
Trailing Twelve Months Financial Highlights
| Twelve Months Ended | ||||
| September 30, | ||||
|
2021 |
2020 |
|||
| (in $ millions) | ||||
| Full game |
1,911 |
1,686 |
||
| Live services and other |
4,485 |
3,904 |
||
| Total net revenue |
6,396 |
5,590 |
||
| Net income |
785 |
1,314 |
||
| Operating cash flow |
1,416 |
2,041 |
||
| Value of shares repurchased |
1,301 |
674 |
||
| Number of shares repurchased |
9.5 |
6.5 |
||
The following GAAP-based financial data2 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 September 30, 2021 | |||||||||||
| 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 |
6,396 |
|
– |
|
681 |
– |
|
||||
| Cost of revenue |
1,729 |
|
(48 |
) |
– |
(5 |
) |
||||
| Gross profit |
4,667 |
|
48 |
|
681 |
5 |
|
||||
| Total operating expenses |
3,579 |
|
(89 |
) |
– |
(489 |
) |
||||
| Operating income |
1,088 |
|
137 |
|
681 |
494 |
|
||||
| Interest and other income (expense), net |
(44 |
) |
– |
|
– |
– |
|
||||
| Income before provision for income taxes |
1,044 |
|
137 |
|
681 |
494 |
|
||||
Operating Metric
The following is a calculation of our total net bookings1 for the periods presented:
|
Three Months Ended |
Twelve Months Ended | |||||||||
| September 30, | September 30, | |||||||||
|
2021 |
2020 |
2021 |
2020 |
|||||||
| (in $ millions) | ||||||||||
| Total net revenue |
1,826 |
1,151 |
|
6,396 |
5,590 |
|
||||
| Change in deferred net revenue (online-enabled games) |
25 |
(241 |
) |
681 |
(13 |
) |
||||
| Net bookings |
1,851 |
910 |
|
7,077 |
5,577 |
|
||||
Business Outlook as of November 3, 2021
Our financial expectations for the quarter ending December 31, 2021 and the fiscal year ending March 31, 2022 include estimates of the impact of our completed acquisitions on consolidated results and could be materially impacted as we integrate these acquisitions.
Fiscal Year 2022 Expectations – Ending March 31, 2022
Financial metrics:
-
Net revenue is expected to be approximately $6.925 billion.
- Change in deferred net revenue (online-enabled games) is expected to be approximately $700 million.
- Net income is expected to be approximately $583 million.
- Diluted earnings per share is expected to be approximately $2.03.
- Operating cash flow is expected to be approximately $1.950 billion.
- The Company estimates a share count of 287 million for purposes of calculating fiscal year 2022 diluted earnings per share.
Operational metric:
- Net bookings1 is expected to be approximately $7.625 billion.
In addition, the following outlook for GAAP-based financial data2 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, 2022 |
|||||||||||
| 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 |
6,925 |
– |
|
700 |
– |
|
|||||
| Cost of revenue |
1,848 |
(130 |
) |
– |
(5 |
) |
|||||
| Operating expense |
4,110 |
(145 |
) |
– |
(545 |
) |
|||||
| Income before provision for income taxes |
908 |
275 |
|
700 |
550 |
|
|||||
| Net income |
583 |
||||||||||
| Number of shares used in computation: | |||||||||||
| Diluted shares |
287 |
||||||||||
Third Quarter Fiscal Year 2022 Expectations – Ending December 31, 2021
Financial metrics:
-
Net revenue is expected to be approximately $1.750 billion.
- Change in deferred net revenue (online-enabled games) is expected to be approximately $875 million.
- Net income is expected to be approximately $5 million.
- Diluted earnings per share is expected to be approximately $0.02.
- The Company estimates a share count of 287 million for purposes of calculating third quarter fiscal 2022 diluted earnings per share.
Operational metric:
- Net bookings1 is expected to be approximately $2.625 billion.
In addition, the following outlook for GAAP-based financial data2 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 December 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 |
1,750 |
– |
|
875 |
– |
|
||||||
| Cost of revenue |
625 |
(50 |
) |
– |
– |
|
||||||
| Operating expense |
1,100 |
(35 |
) |
– |
(135 |
) |
||||||
| Income before provision for income taxes |
8 |
85 |
|
875 |
135 |
|
||||||
| Net income |
5 |
|||||||||||
| Number of shares used in computation: | ||||||||||||
| Diluted shares |
287 |
|||||||||||
Conference Call and Supporting Documents
Electronic Arts will host a conference call on November 3, 2021 at 2:00 pm PT (5:00 pm ET) to review its results for the fiscal quarter ended September 30, 2021 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 3697115 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 November 17, 2021 at 855-859-2056 (domestic) or 404-537-3406 (international) using pin code 3697115. 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 expectations under the heading “Business Outlook as of November 3, 2021,” and other information regarding EA’s fiscal 2022 and other future 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, and integrate, 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, 2021.
These forward-looking statements are current as of November 3, 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 September 30, 2021. 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 September 30, 2021.
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 2021, EA posted GAAP net revenue of $5.6 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™, Plants vs. Zombies™ and F1®. More information about EA is available at www.ea.com/news.
EA SPORTS, Battlefield, Need for Speed, Apex Legends, The Sims, Titanfall and Plants vs. Zombies are trademarks of Electronic Arts Inc. STAR WARS © & TM 2015 Lucasfilm Ltd. All rights reserved. John Madden, NFL, FIFA and F1 are the property of their respective owners and used with permission.
1 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.
2 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, 2021.
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
||||||||||||
|
Unaudited Condensed Consolidated Statements of Operations |
||||||||||||
|
(in $ millions, except per share data) |
||||||||||||
|
|
|
|
|
|
||||||||
|
|
Three Months Ended September 30, |
Six Months Ended September 30, |
||||||||||
|
|
||||||||||||
|
|
2021 |
2020 |
2021 |
2020 |
||||||||
|
Net revenue |
1,826 |
|
1,151 |
|
3,377 |
|
2,610 |
|
||||
|
Cost of revenue |
494 |
|
286 |
|
809 |
|
574 |
|
||||
|
Gross profit |
1,332 |
|
865 |
|
2,568 |
|
2,036 |
|
||||
|
Operating expenses: |
|
|
|
|
||||||||
|
Research and development |
553 |
|
421 |
|
1,068 |
|
859 |
|
||||
|
Marketing and sales |
233 |
|
156 |
|
423 |
|
277 |
|
||||
|
General and administrative |
176 |
|
133 |
|
345 |
|
269 |
|
||||
|
Amortization of intangibles |
30 |
|
6 |
|
70 |
|
11 |
|
||||
|
Total operating expenses |
992 |
|
716 |
|
1,906 |
|
1,416 |
|
||||
|
Operating income |
340 |
|
149 |
|
662 |
|
620 |
|
||||
|
Interest and other income (expense), net |
(14 |
) |
(10 |
) |
(28 |
) |
(13 |
) |
||||
|
Income before provision for (benefit from) income taxes |
326 |
|
139 |
|
634 |
|
607 |
|
||||
|
Provision for (benefit from) income taxes |
32 |
|
(46 |
) |
136 |
|
57 |
|
||||
|
Net income |
294 |
|
185 |
|
498 |
|
550 |
|
||||
|
Earnings per share |
|
|
|
|
||||||||
|
Basic |
1.03 |
|
0.64 |
|
1.75 |
|
1.90 |
|
||||
|
Diluted |
1.02 |
|
0.63 |
|
1.73 |
|
1.88 |
|
||||
|
Number of shares used in computation |
|
|
|
|
||||||||
|
Basic |
285 |
|
289 |
|
285 |
|
289 |
|
||||
|
Diluted |
287 |
|
293 |
|
288 |
|
292 |
|
||||
Results (in $ millions, except per share data)
The following table reports the variance of the actuals versus our guidance provided on August 4, 2021 for the three months ended September 30, 2021 plus a comparison to the actuals for the three months ended September 30, 2020.
|
|
Three Months Ended September 30, |
|||||||||||
|
|
2021 |
|
2021 |
2020 |
||||||||
|
|
Guidance |
Variance |
Actuals |
Actuals |
||||||||
|
Net revenue |
|
|
|
|
||||||||
|
Net revenue |
1,775 |
|
51 |
|
1,826 |
|
1,151 |
|
||||
|
GAAP-based financial data |
|
|
|
|
||||||||
|
Change in deferred net revenue (online-enabled games)1 |
(50 |
) |
75 |
|
25 |
|
(241 |
) |
||||
|
Cost of revenue |
|
|
|
|
||||||||
|
Cost of revenue |
518 |
|
(24 |
) |
494 |
|
286 |
|
||||
|
GAAP-based financial data |
|
|
|
|
||||||||
|
Acquisition-related expenses |
(35 |
) |
13 |
|
(22 |
) |
— |
|
||||
|
Stock-based compensation |
— |
|
(2 |
) |
(2 |
) |
(2 |
) |
||||
|
Operating expenses |
|
|
|
|
||||||||
|
Operating expenses |
1,030 |
|
(38 |
) |
992 |
|
716 |
|
||||
|
GAAP-based financial data |
|
|
|
|
||||||||
|
Acquisition-related expenses |
(40 |
) |
10 |
|
(30 |
) |
(6 |
) |
||||
|
Stock-based compensation |
(150 |
) |
3 |
|
(147 |
) |
(111 |
) |
||||
|
Income before tax |
|
|
|
|
||||||||
|
Income before tax |
212 |
|
114 |
|
326 |
|
139 |
|
||||
|
GAAP-based financial data |
|
|
|
|
||||||||
|
Acquisition-related expenses |
75 |
|
(23 |
) |
52 |
|
6 |
|
||||
|
Change in deferred net revenue (online-enabled games)1 |
(50 |
) |
75 |
|
25 |
|
(241 |
) |
||||
|
Stock-based compensation |
150 |
|
(1 |
) |
149 |
|
113 |
|
||||
|
Tax rate used for management reporting |
18 |
% |
|
18 |
% |
18 |
% |
|||||
|
Earnings per share |
|
|
|
|
||||||||
|
Basic |
0.37 |
|
0.66 |
|
1.03 |
|
0.64 |
|
||||
|
Diluted |
0.36 |
|
0.66 |
|
1.02 |
|
0.63 |
|
||||
|
Number of shares |
|
|
|
|
||||||||
|
Basic |
286 |
|
(1 |
) |
285 |
|
289 |
|
||||
|
Diluted |
288 |
|
(1 |
) |
287 |
|
293 |
|
||||
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.
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
||||||
|
Unaudited Condensed Consolidated Balance Sheets |
||||||
|
(in $ millions) |
||||||
|
|
|
|
||||
|
|
September 30, 2021 |
March 31, 20212 |
||||
|
ASSETS |
|
|
||||
|
Current assets: |
|
|
||||
|
Cash and cash equivalents |
1,630 |
|
5,260 |
|
||
|
Short-term investments |
342 |
|
1,106 |
|
||
|
Receivables, net |
1,031 |
|
521 |
|
||
|
Other current assets |
387 |
|
326 |
|
||
|
Total current assets |
3,390 |
|
7,213 |
|
||
|
Property and equipment, net |
516 |
|
491 |
|
||
|
Goodwill |
5,459 |
|
2,868 |
|
||
|
Acquisition-related intangibles, net |
1,080 |
|
309 |
|
||
|
Deferred income taxes, net |
2,139 |
|
2,045 |
|
||
|
Other assets |
435 |
|
362 |
|
||
|
TOTAL ASSETS |
13,019 |
|
13,288 |
|
||
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
||||
|
Current liabilities: |
|
|
||||
|
Accounts payable |
136 |
|
96 |
|
||
|
Accrued and other current liabilities |
1,119 |
|
1,341 |
|
||
|
Deferred net revenue (online-enabled games) |
1,322 |
|
1,527 |
|
||
|
Total current liabilities |
2,577 |
|
2,964 |
|
||
|
Senior notes, net |
1,877 |
|
1,876 |
|
||
|
Income tax obligations |
318 |
|
315 |
|
||
|
Deferred income taxes, net |
68 |
|
43 |
|
||
|
Other liabilities |
323 |
|
250 |
|
||
|
Total liabilities |
5,163 |
|
5,448 |
|
||
|
|
|
|
||||
|
Stockholders’ equity: |
|
|
||||
|
Common stock |
3 |
|
3 |
|
||
|
Retained earnings |
7,855 |
|
7,887 |
|
||
|
Accumulated other comprehensive loss |
(2 |
) |
(50 |
) |
||
|
Total stockholders’ equity |
7,856 |
|
7,840 |
|
||
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
13,019 |
|
13,288 |
|
||
2Derived from audited consolidated financial statements.
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
||||||||||||
|
Unaudited Condensed Consolidated Statements of Cash Flows |
||||||||||||
|
(in $ millions) |
||||||||||||
|
|
|
|
|
|
||||||||
|
|
Three Months Ended September 30, |
Six Months Ended September 30, |
||||||||||
|
|
2021 |
2020 |
2021 |
2020 |
||||||||
|
OPERATING ACTIVITIES |
|
|
|
|
||||||||
|
Net income |
294 |
|
185 |
|
498 |
|
550 |
|
||||
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
|
|
|
|
||||||||
|
Depreciation, amortization and accretion |
94 |
|
40 |
|
199 |
|
77 |
|
||||
|
Stock-based compensation |
149 |
|
113 |
|
274 |
|
215 |
|
||||
|
Change in assets and liabilities |
|
|
|
|
||||||||
|
Receivables, net |
(458 |
) |
83 |
|
(446 |
) |
39 |
|
||||
|
Other assets |
23 |
|
(157 |
) |
(51 |
) |
(113 |
) |
||||
|
Accounts payable |
61 |
|
109 |
|
42 |
|
106 |
|
||||
|
Accrued and other liabilities |
52 |
|
(30 |
) |
(250 |
) |
(96 |
) |
||||
|
Deferred income taxes, net |
(168 |
) |
(42 |
) |
(140 |
) |
(32 |
) |
||||
|
Deferred net revenue (online-enabled games) |
17 |
|
(240 |
) |
(205 |
) |
(307 |
) |
||||
|
Net cash provided by (used in) operating activities |
64 |
|
61 |
|
(79 |
) |
439 |
|
||||
|
INVESTING ACTIVITIES |
|
|
|
|
||||||||
|
Capital expenditures |
(43 |
) |
(25 |
) |
(87 |
) |
(63 |
) |
||||
|
Proceeds from maturities and sales of short-term investments |
621 |
|
724 |
|
1,128 |
|
1,418 |
|
||||
|
Purchase of short-term investments |
(84 |
) |
(752 |
) |
(369 |
) |
(1,416 |
) |
||||
|
Acquisitions, net of cash acquired |
(1,405 |
) |
— |
|
(3,394 |
) |
— |
|
||||
|
Net cash used in investing activities |
(911 |
) |
(53 |
) |
(2,722 |
) |
(61 |
) |
||||
|
FINANCING ACTIVITIES |
|
|
|
|
||||||||
|
Proceeds from issuance of common stock |
41 |
|
40 |
|
41 |
|
43 |
|
||||
|
Cash dividends paid |
(48 |
) |
— |
|
(97 |
) |
— |
|
||||
|
Cash paid to taxing authorities for shares withheld from employees |
(16 |
) |
(8 |
) |
(121 |
) |
(77 |
) |
||||
|
Repurchase and retirement of common stock |
(325 |
) |
— |
|
(650 |
) |
(78 |
) |
||||
|
Net cash provided by (used in) financing activities |
(348 |
) |
32 |
|
(827 |
) |
(112 |
) |
||||
|
Effect of foreign exchange on cash and cash equivalents |
(13 |
) |
6 |
|
(2 |
) |
25 |
|
||||
|
Change in cash and cash equivalents |
(1,208 |
) |
46 |
|
(3,630 |
) |
291 |
|
||||
|
Beginning cash and cash equivalents |
2,838 |
|
4,013 |
|
5,260 |
|
3,768 |
|
||||
|
Ending cash and cash equivalents |
1,630 |
|
4,059 |
|
1,630 |
|
4,059 |
|
||||
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
||||||||||||||||||
|
Unaudited Supplemental Financial Information and Business Metrics |
||||||||||||||||||
|
(in $ millions, except per share data) |
||||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||
|
|
Q2 |
Q3 |
Q4 |
Q1 |
Q2 |
YOY % |
||||||||||||
|
|
FY21 |
FY21 |
FY21 |
FY22 |
FY22 |
Change |
||||||||||||
|
Net revenue |
|
|
|
|
|
|
||||||||||||
|
Net revenue |
1,151 |
|
1,673 |
|
1,346 |
|
1,551 |
|
1,826 |
|
|
|
||||||
|
GAAP-based financial data |
|
|
|
|
|
|
||||||||||||
|
Change in deferred net revenue (online-enabled games)1 |
(241 |
) |
727 |
|
144 |
|
(215 |
) |
25 |
|
|
|||||||
|
Gross profit |
|
|
|
|
|
|
||||||||||||
|
Gross profit |
865 |
|
1,072 |
|
1,027 |
|
1,236 |
|
1,332 |
|
|
|
||||||
|
Gross profit (as a % of net revenue) |
75 |
% |
64 |
% |
76 |
% |
80 |
% |
73 |
% |
|
|||||||
|
GAAP-based financial data |
|
|
|
|
|
|
||||||||||||
|
Acquisition-related expenses |
— |
|
— |
|
4 |
|
22 |
|
22 |
|
|
|||||||
|
Change in deferred net revenue (online-enabled games)1 |
(241 |
) |
727 |
|
144 |
|
(215 |
) |
25 |
|
|
|||||||
|
Stock-based compensation |
2 |
|
1 |
|
1 |
|
1 |
|
2 |
|
|
|||||||
|
Operating income |
|
|
|
|
|
|
||||||||||||
|
Operating income |
149 |
|
251 |
|
175 |
|
322 |
|
340 |
|
|
|
||||||
|
Operating income (as a % of net revenue) |
13 |
% |
15 |
% |
13 |
% |
21 |
% |
19 |
% |
|
|||||||
|
GAAP-based financial data |
|
|
|
|
|
|
||||||||||||
|
Acquisition-related expenses |
6 |
|
5 |
|
18 |
|
62 |
|
52 |
|
|
|||||||
|
Change in deferred net revenue (online-enabled games)1 |
(241 |
) |
727 |
|
144 |
|
(215 |
) |
25 |
|
|
|||||||
|
Stock-based compensation |
113 |
|
111 |
|
109 |
|
125 |
|
149 |
|
|
|||||||
|
Net income |
|
|
|
|
|
|
||||||||||||
|
Net income |
185 |
|
211 |
|
76 |
|
204 |
|
294 |
|
|
|
||||||
|
Net income (as a % of net revenue) |
16 |
% |
13 |
% |
6 |
% |
13 |
% |
16 |
% |
|
|||||||
|
GAAP-based financial data |
|
|
|
|
|
|
||||||||||||
|
Acquisition-related expenses |
6 |
|
5 |
|
18 |
|
62 |
|
52 |
|
|
|||||||
|
Change in deferred net revenue (online-enabled games)1 |
(241 |
) |
727 |
|
144 |
|
(215 |
) |
25 |
|
|
|||||||
|
Stock-based compensation |
113 |
|
111 |
|
109 |
|
125 |
|
149 |
|
|
|||||||
|
Tax rate used for management reporting |
18 |
% |
18 |
% |
18 |
% |
18 |
% |
18 |
% |
|
|||||||
|
Diluted earnings per share |
0.63 |
|
0.72 |
|
0.26 |
|
0.71 |
|
1.02 |
|
|
|
||||||
|
Number of diluted shares used in computation |
|
|
|
|
|
|
||||||||||||
|
Basic |
289 |
|
290 |
|
288 |
|
286 |
|
285 |
|
|
|||||||
|
Diluted |
293 |
|
292 |
|
290 |
|
289 |
|
287 |
|
|
|||||||
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.
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
||||||||||||||||||
|
Unaudited Supplemental Financial Information and Business Metrics |
||||||||||||||||||
|
(in $ millions) |
||||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||
|
|
Q2 |
Q3 |
Q4 |
Q1 |
Q2 |
YOY % |
||||||||||||
|
|
FY21 |
FY21 |
FY21 |
FY22 |
FY22 |
Change |
||||||||||||
|
QUARTERLY NET REVENUE PRESENTATIONS |
|
|
|
|
|
|
||||||||||||
|
Net revenue by composition |
|
|
|
|
|
|
||||||||||||
|
Full game downloads |
163 |
|
347 |
|
185 |
|
233 |
|
337 |
|
107 |
% |
||||||
|
Packaged goods |
119 |
|
375 |
|
65 |
|
89 |
|
280 |
|
135 |
% |
||||||
|
Full game |
282 |
|
722 |
|
250 |
|
322 |
|
617 |
|
119 |
% |
||||||
|
Live services and other |
869 |
|
951 |
|
1,096 |
|
1,229 |
|
1,209 |
|
39 |
% |
||||||
|
Total net revenue |
1,151 |
|
1,673 |
|
1,346 |
|
1,551 |
|
1,826 |
|
|
|
||||||
|
Full game |
25 |
% |
43 |
% |
19 |
% |
21 |
% |
34 |
% |
|
|||||||
|
Live services and other |
75 |
% |
57 |
% |
81 |
% |
79 |
% |
66 |
% |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
GAAP-based financial data |
|
|
|
|||||||||||||||
|
Full game downloads |
(2 |
) |
53 |
|
(19 |
) |
(5 |
) |
35 |
|
|
|||||||
|
Packaged goods |
(14 |
) |
83 |
|
(44 |
) |
(35 |
) |
44 |
|
|
|||||||
|
Full game |
(16 |
) |
136 |
|
(63 |
) |
(40 |
) |
79 |
|
|
|||||||
|
Live services and other |
(225 |
) |
591 |
|
207 |
|
(175 |
) |
(54 |
) |
|
|||||||
|
Total change in deferred net revenue (online-enabled games) by composition1 |
(241 |
) |
727 |
|
144 |
|
(215 |
) |
25 |
|
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||
|
Net revenue by platform |
|
|
|
|
|
|
||||||||||||
|
Console |
714 |
|
1,191 |
|
879 |
|
972 |
|
1,198 |
|
68 |
% |
||||||
|
PC & Other |
249 |
|
326 |
|
295 |
|
361 |
|
377 |
|
51 |
% |
||||||
|
Mobile |
188 |
|
156 |
|
172 |
|
218 |
|
251 |
|
34 |
% |
||||||
|
Total net revenue |
1,151 |
|
1,673 |
|
1,346 |
|
1,551 |
|
1,826 |
|
|
|
||||||
|
GAAP-based financial data |
|
|
|
|||||||||||||||
|
Console |
(201 |
) |
619 |
|
71 |
|
(278 |
) |
(29 |
) |
|
|||||||
|
PC & Other |
(24 |
) |
73 |
|
51 |
|
9 |
|
26 |
|
|
|||||||
|
Mobile |
(16 |
) |
35 |
|
22 |
|
54 |
|
28 |
|
|
|||||||
|
Total change in deferred net revenue (online-enabled games) by platform1 |
(241 |
) |
727 |
|
144 |
|
(215 |
) |
25 |
|
|
|||||||
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.
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES |
||||||||||||||||||
|
Unaudited Supplemental Financial Information and Business Metrics |
||||||||||||||||||
|
(in $ millions) |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
Q2 |
|
Q3 |
|
Q4 |
|
Q1 |
|
Q2 |
|
YOY % |
|||||||
|
|
FY21 |
|
FY21 |
|
FY21 |
|
FY22 |
|
FY22 |
|
Change |
|||||||
|
CASH FLOW DATA |
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Operating cash flow |
61 |
|
|
1,124 |
|
|
371 |
|
|
(143 |
) |
|
64 |
|
|
5 |
% |
|
|
Operating cash flow – TTM |
2,041 |
|
|
2,061 |
|
|
1,934 |
|
|
1,413 |
|
|
1,416 |
|
|
(31 |
%) |
|
|
Capital expenditures |
25 |
|
|
30 |
|
|
31 |
|
|
44 |
|
|
43 |
|
|
72 |
% |
|
|
Capital expenditures – TTM |
131 |
|
133 |
|
124 |
|
130 |
|
148 |
|
13 |
% |
||||||
|
Repurchase and retirement of common stock |
— |
|
|
326 |
|
|
325 |
|
|
325 |
|
|
325 |
|
|
100 |
% |
|
|
Cash dividends paid |
— |
|
|
49 |
|
49 |
|
49 |
|
48 |
|
100 |
% |
|||||
|
DEPRECIATION |
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Depreciation expense |
32 |
|
37 |
|
38 |
|
40 |
|
39 |
|
22 |
% |
||||||
|
BALANCE SHEET DATA |
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Cash and cash equivalents |
4,059 |
|
4,772 |
|
5,260 |
|
2,838 |
|
1,630 |
|
|
|||||||
|
Short-term investments |
1,972 |
|
1,938 |
|
1,106 |
|
881 |
|
342 |
|
|
|||||||
|
Cash and cash equivalents, and short-term investments |
6,031 |
|
|
6,710 |
|
|
6,366 |
|
|
3,719 |
|
|
1,972 |
|
|
(67 |
%) |
|
|
Receivables, net |
423 |
|
778 |
|
521 |
|
557 |
|
1,031 |
|
144 |
% |
||||||
|
STOCK-BASED COMPENSATION |
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Cost of revenue |
2 |
|
|
1 |
|
|
1 |
|
|
1 |
|
|
2 |
|
|
|
||
|
Research and development |
74 |
|
74 |
|
71 |
|
85 |
|
101 |
|
|
|||||||
|
Marketing and sales |
12 |
|
11 |
|
12 |
|
12 |
|
15 |
|
|
|||||||
|
General and administrative |
25 |
|
25 |
|
25 |
|
27 |
|
31 |
|
|
|||||||
|
Total stock-based compensation |
113 |
|
|
111 |
|
|
109 |
|
|
125 |
|
|
149 |
|
|
|
||
Category: Company News
Source: Electronic Arts Inc.