EA Slides on Mixed Results

Electronic Arts Inc. (NASDAQ: EA) reported fiscal second-quarter financial results after markets closed on Tuesday. The company said that it had a net loss of $0.13 per share and $898 million in revenue, not including a change in deferred revenue of $200 million. The consensus estimates from Thomson Reuters had called for $0.43 in earnings per share (EPS) and $1.09 billion in revenue. The same period from last year had $0.65 in EPS and $1.15 billion in revenue.

Note that these results may look significantly different from the consensus estimates given, but the company is moving towards reporting on an all GAAP basis while most estimates are non-GAAP.

Battlefield 1 total player base for the first week was nearly double that of Battlefield 4, and it is continuing to grow.

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Net sales from FIFA, Madden NFL and Hockey Ultimate Team are collectively up 15% for the trailing twelve-months compared to last year. Also FIFA Mobile reached #1 on the App Store Free Games chart in 138 countries.

In terms of guidance for the fiscal third quarter, the company expects to have a net loss per share of roughly $0.17 and net revenue to be $1.125 billion.

On the books, cash, cash equivalents, and short-term investments totaled $3.27 billion at the end of the quarter, versus $3.83 billion at the end of the previous fiscal year.

Andrew Wilson, CEO of EA, commented:

Q2 was an excellent quarter for Electronic Arts, led by breakthrough new EA SPORTS titles engaging players across console and mobile.We are in an outstanding position for the quarter ahead, with two of the highest-rated games of this console generation in Battlefield 1 and Titanfall 2, global competitive gaming tournaments underway, and our first virtual reality experiences coming soon. Across all platforms, this holiday season will be a fantastic time to play.

Shares of EA closed Tuesday down nearly 1% at $77.84, with a consensus analyst price target of $90.25 and a 52-week trading range of $53.01 to $86.07. Following the release of the earnings report, the stock was initially down 2.2% at $76.10 in the after-hours trading session.

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