Electronic Arts Inc. Q4 FY2025 earnings call

Key Franchise Performances

• EA SPORTS FC: Rebounded in engagement and monetization post-January gameplay update, FC Mobile had double-digit net bookings growth.
• American football: Madden NFL and college football had double-digit growth in plays and hours played, with net bookings over $1 billion YOY.
• The Sims: Q4 had over 30% net bookings growth due to 25th birthday celebrations and re-release of legacy titles.
• Split Fiction: Had a strong launch with units sold nearly double expectations.

AI Impact

AI is seen as a powerful accelerator for creativity, innovation, and player connection, used to enhance in-game worlds and athlete likenesses.

EA Sports App

In soft launch in Spain, showing positive early indicators of engagement and retention, with plans to expand reach and enhance experience.

In FY25, EA Sports had its biggest net bookings year ever. Q4 net bookings were $1.8 billion, up 8%. Full game net bookings were $384 million, up 48% due to Split Fiction's successful launch. Live services and other net bookings were $1.42 billion, up 1%. Global football saw engagement and monetization rebound after the January gameplay update, with FC Mobile having double-digit net bookings growth. American football had double-digit growth in plays across Madden NFL and college football, with net bookings over $1 billion, up over 70% YOY. The Sims had over 30% net bookings growth in Q4. EA SPORTS FC contributed to global reach and engagement, FC Mobile in particular in markets like Southeast Asia and the Middle East. American football's ecosystem had strong late-cycle engagement trends, and The Sims benefited from 25th birthday celebrations.

Fiscal Year Guidance

• Expected fiscal year net bookings: $7.6 billion to $8 billion, up 3% to 9% YOY.
• GAAP net revenue: $7.1 billion to $7.5 billion.
• GAAP operating expenses: $4.47 billion to $4.57 billion.
• GAAP operating margin: 16.3% to 18.9%; non-GAAP operating margin: 27.2% to 29.2%.
• GAAP EPS: $3.09 to $3.79.

Q1 Guidance

• Net bookings: $1.175 billion to $1.275 billion, down 7% to up 1%.
• GAAP net revenue: $1.55 billion to $1.65 billion.
• Earnings per share: $0.49 to $0.66.

Potential risks include macroeconomic uncertainty affecting consumer spending, market competition impacting product performance, and new game releases not meeting expectations.

Q: When you think about the temporary slowdown in EA SPORTS FC and the efforts to turn it around, what were the main issues and how did you fix them?

A: The temporary slowdown was due to factors like ebb and flow in live service businesses, delayed ebb by COVID, World Cup, and FC rebrand. Fixed by incentivizing players to move from FC24 to FC25 through personalized marketing and a robust gameplay update.

Q: Given the approach to Battlefield with beta testing, what are key learnings and how does it compare to prior versions?

A: Key learnings include better engaging community, understanding player feedback on map, weapon, and progression. Compared to prior versions, this time worked closely with community from the start.

Q: How to think about American football's growth in the coming year?

A: American football continues to grow with the sport, benefit from growth of sport and young fans' uptake of interactive entertainment. Last year was a record year but it's a tough comp, with Q2 likely tougher due to pent-up demand for College Football.