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Electronic Arts (EA) to Report Q1 Earnings: What's in Store?
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Electronic Arts (EA - Free Report) is set to report first-quarter fiscal 2021 results on Jul 30.
For the quarter, EA expects GAAP revenues of $1.22 billion.
The Zacks Consensus Estimate for first-quarter fiscal 2021 revenues is pegged at $1.07 billion, which indicates an increase of 43.5% from the year-ago quarter reported figure.
The company expects GAAP earnings to be 93 cents per share for the to-be reported quarter. EA had reported loss of 2 cents per share reported in the year-ago quarter. The consensus mark for earnings has increased 6.5% to 82 cents per share over the past 30 days.
Notably, the company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while missing in one, the average negative surprise being 59.91%.
Let’s see how things have shaped up prior to this announcement.
Factors to Consider
EA’s focus on adding updates to its games that feature exciting content makes the platform attractive to users. Moreover, coronavirus-led lockdown is expected to have been a major growth driver in increasing the number of active users in the to-be-reported quarter.
Solid popularity of gaming franchises like The Sims 4 and Apex Legends is expected to have benefited EA’s net bookings in the to-be-reported quarter. Notably, net bookings are expected to be $1 billion for the first quarter as guided by the company.
Additionally, launch of 25 games on Steam including the Battlefield franchise, The Sims 4 ninth expansion pack Eco Lifestyle and the availability of Command & Conquer Remastered Collection on PC via Origin and Steam is expected to have contributed to active user engagement in the to-be-reported quarter.
Strong popularity of two well-recognized EA Sports franchises, FIFA and Madden NFL, is expected to have contributed to top-line growth in the soon-to-be-reported quarter.
Moreover, the launch of various tournaments as part of EA’s Stay Home, Play Together initiative are expected to have led to an increase in fan base and viewership globally amid coronavirus-induced lockdown.
Notably, three new online tournaments with a prize pool of $100K each under Apex Legends Global Series, EA SPORTS Madden NFL 20 live tournament held on Twitch where NFL fans watched their favorite athletes go head-to-head in the NFL Checkdown x Madden Tournament and EA SPORTS FIFA 20 Stay and Play Cup were held to help keep the gaming community safe and connected.
Further, EA's strength in Live Services from mobile games such as Madden Mobile, FIFA Mobile and Star Wars: Galaxy of Heroes is expected to have positively impacted the top line.
Notably, EA Access on PS 4 is expected to have contributed to the company’s subscription revenues in the to-be-reported amid coronavirus-induced lockdown.
However, intensifying competition in the video game space from the likes of Activision, Take-Two Interactive and Zynga is likely to have hurt top-line growth.
Key Developments in Q1
Electronic Arts and La Liga announced a 10-year partnership under which EA SPORTS will remain the exclusive Official Video Games Partner of La Liga.
On Jun 12, Electronic Arts and Federation Internationale de Football Association (FIFA) announced a larger, evolved EA SPORTS FIFA 20 esports ecosystem. This involved adding competitions and resuming football league tournaments as well as online matches in place of the EA SPORTS FIFA 20 Global Series including the FIFA eWorld Cup.
During the quarter, EA and Google announced a partnership to launch five EA games on Stadia, Google’s cloud-based gaming platform.
What Our Model Says
According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Electronic Arts has an Earnings ESP of +4.45% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Here are a few other companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:
NXP Semiconductors N.V. (NXPI - Free Report) has an Earnings ESP of +11.9% and holds a Zacks Rank of 2.
Take-Two Interactive Software, Inc. (TTWO - Free Report) has an Earnings ESP of +12.97% and a Zacks Rank #2.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
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Electronic Arts (EA) to Report Q1 Earnings: What's in Store?
Electronic Arts (EA - Free Report) is set to report first-quarter fiscal 2021 results on Jul 30.
For the quarter, EA expects GAAP revenues of $1.22 billion.
The Zacks Consensus Estimate for first-quarter fiscal 2021 revenues is pegged at $1.07 billion, which indicates an increase of 43.5% from the year-ago quarter reported figure.
The company expects GAAP earnings to be 93 cents per share for the to-be reported quarter. EA had reported loss of 2 cents per share reported in the year-ago quarter. The consensus mark for earnings has increased 6.5% to 82 cents per share over the past 30 days.
Notably, the company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while missing in one, the average negative surprise being 59.91%.
Let’s see how things have shaped up prior to this announcement.
Factors to Consider
EA’s focus on adding updates to its games that feature exciting content makes the platform attractive to users. Moreover, coronavirus-led lockdown is expected to have been a major growth driver in increasing the number of active users in the to-be-reported quarter.
Solid popularity of gaming franchises like The Sims 4 and Apex Legends is expected to have benefited EA’s net bookings in the to-be-reported quarter. Notably, net bookings are expected to be $1 billion for the first quarter as guided by the company.
Electronic Arts Inc. Price and EPS Surprise
Electronic Arts Inc. price-eps-surprise | Electronic Arts Inc. Quote
Additionally, launch of 25 games on Steam including the Battlefield franchise, The Sims 4 ninth expansion pack Eco Lifestyle and the availability of Command & Conquer Remastered Collection on PC via Origin and Steam is expected to have contributed to active user engagement in the to-be-reported quarter.
Strong popularity of two well-recognized EA Sports franchises, FIFA and Madden NFL, is expected to have contributed to top-line growth in the soon-to-be-reported quarter.
Moreover, the launch of various tournaments as part of EA’s Stay Home, Play Together initiative are expected to have led to an increase in fan base and viewership globally amid coronavirus-induced lockdown.
Notably, three new online tournaments with a prize pool of $100K each under Apex Legends Global Series, EA SPORTS Madden NFL 20 live tournament held on Twitch where NFL fans watched their favorite athletes go head-to-head in the NFL Checkdown x Madden Tournament and EA SPORTS FIFA 20 Stay and Play Cup were held to help keep the gaming community safe and connected.
Further, EA's strength in Live Services from mobile games such as Madden Mobile, FIFA Mobile and Star Wars: Galaxy of Heroes is expected to have positively impacted the top line.
Notably, EA Access on PS 4 is expected to have contributed to the company’s subscription revenues in the to-be-reported amid coronavirus-induced lockdown.
However, intensifying competition in the video game space from the likes of Activision, Take-Two Interactive and Zynga is likely to have hurt top-line growth.
Key Developments in Q1
Electronic Arts and La Liga announced a 10-year partnership under which EA SPORTS will remain the exclusive Official Video Games Partner of La Liga.
On Jun 12, Electronic Arts and Federation Internationale de Football Association (FIFA) announced a larger, evolved EA SPORTS FIFA 20 esports ecosystem. This involved adding competitions and resuming football league tournaments as well as online matches in place of the EA SPORTS FIFA 20 Global Series including the FIFA eWorld Cup.
During the quarter, EA and Google announced a partnership to launch five EA games on Stadia, Google’s cloud-based gaming platform.
What Our Model Says
According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Electronic Arts has an Earnings ESP of +4.45% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Here are a few other companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:
Etsy, Inc. (ETSY - Free Report) has an Earnings ESP of +1.15% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
NXP Semiconductors N.V. (NXPI - Free Report) has an Earnings ESP of +11.9% and holds a Zacks Rank of 2.
Take-Two Interactive Software, Inc. (TTWO - Free Report) has an Earnings ESP of +12.97% and a Zacks Rank #2.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>