Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Electronic Arts Reports Q4 and FY24 Results By: Electronic Arts Inc. via Business Wire May 07, 2024 at 16:05 PM EDT EA SPORTS™ Momentum Continued in FY24, Company Delivers Record Fiscal Year Cash Flow Electronic Arts Inc. (NASDAQ: EA) today announced preliminary financial results for its fourth quarter and fiscal year ended March 31, 2024. “This year, EA delivered bigger, bolder world class entertainment that engaged and connected hundreds of millions of players and fans,” said Andrew Wilson, CEO of EA. “We will continue to build on this strong momentum through an incredible pipeline of new experiences, starting with College Football in FY25, positioning us for accelerated growth in FY26 and beyond.” “EA’s FY24 was highlighted by record cash flow and strong earnings growth driven by EA SPORTS FC™ and Madden NFL,” said Stuart Canfield, CFO of EA. “With strong conviction in our future, we are announcing an expanded stock repurchase program. We look forward to sharing more about our long-term strategy and financial framework at our Investor Day this fall.” Selected Operating Highlights and Metrics1 Net bookings2 for FY24 was $7.430 billion, up 1% year-over-year (up 3% in constant currency). Delivered 11 titles and over 600 content updates in the year, including four non-annual sports titles and the successful rebrand of EA SPORTS FC. Our global football franchise grew net bookings by high-teens percent in FY24. During FY24, our EA SPORTS™ Madden NFL franchise delivered record net bookings, up 6% year-over-year and double-digit growth in weekly average users for both Madden NFL 24 and Madden Mobile. Selected Financial Highlights and Metrics Net revenue for FY24 was $7.562 billion, up 2% year-over-year. For FY24, net cash provided by operating activities was a fiscal year record $2.315 billion, up 49% year-over-year. During FY24, EA returned $1.505 billion to stockholders through stock repurchases and dividends. The board has authorized a new stock repurchase program of $5 billion over three years. Dividend EA has declared a quarterly cash dividend of $0.19 per share of the Company’s common stock. The dividend is payable on June 19, 2024 to stockholders of record as of the close of business on May 29, 2024. Quarterly Financial Highlights Three Months Ended March 31, (in $ millions, except per share amounts) 2024 2023 Full game 333 372 Live services and other 1,446 1,502 Total net revenue 1,779 1,874 Net income (loss) 182 (12 ) Diluted earnings (loss) per share 0.67 (0.04 ) Operating cash flow 580 617 Value of shares repurchased 325 325 Number of shares repurchased 2.3 2.7 Cash dividend paid 51 52 The following GAAP-based financial data3 and tax rate of 19% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results: Three Months Ended March 31, 2024 GAAP-Based Financial Data (in $ millions) Statement of Operations Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 1,779 — (113 ) — — Cost of revenue 357 (29 ) — — (2 ) Gross profit 1,422 29 (113 ) — 2 Total operating expenses 1,188 (72 ) — (61 ) (146 ) Operating income 234 101 (113 ) 61 148 Interest and other income (expense), net 26 — — — — Income before provision for income taxes 260 101 (113 ) 61 148 Number of shares used in computation: Diluted 270 Fiscal Year Financial Highlights Twelve Months Ended March 31, (in $ millions, except per share amounts) 2024 2023 Full game 2,015 1,937 Live services and other 5,547 5,489 Total net revenue 7,562 7,426 Net income 1,273 802 Diluted earnings per share 4.68 2.88 Operating cash flow 2,315 1,550 Value of shares repurchased 1,300 1,295 Number of shares repurchased 10.0 10.4 Cash dividend paid 205 210 The following GAAP-based financial data3 and a tax rate of 19% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results. Twelve Months Ended March 31, 2024 GAAP-Based Financial Data (in $ millions) Statement of Operations Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 7,562 — (132 ) — — Cost of revenue 1,710 (76 ) — — (8 ) Gross profit 5,852 76 (132 ) — 8 Total operating expenses 4,334 (142 ) — (64 ) (576 ) Operating income 1,518 218 (132 ) 64 584 Interest and other income (expense), net 71 — — — — Income before provision for income taxes 1,589 218 (132 ) 64 584 Number of shares used in computation: Diluted 272 Operating Metric The following is a calculation of our total net bookings2 for the periods presented: Three Months Ended March 31, Twelve Months Ended March 31, (in $ millions) 2024 2023 2024 2023 Total net revenue 1,779 1,874 7,562 7,426 Change in deferred net revenue (online-enabled games) (113 ) 72 (132 ) (85 ) Total net bookings 1,666 1,946 7,430 7,341 Business Outlook as of May 7, 2024 Fiscal Year 2025 Expectations – Ending March 31, 2025 Financial outlook metrics: Net revenue is expected to be approximately $7.100 billion to $7.500 billion. Change in deferred net revenue (online-enabled games) is expected to be approximately $200 million. Net income is expected to be approximately $904 million to $1.085 billion. Diluted earnings per share is expected to be approximately $3.34 to $4.00. Operating cash flow is expected to be approximately $2.050 billion to $2.250 billion. The Company estimates a share count of 271 million for purposes of calculating diluted earnings per share. Operational outlook metric: Net bookings2 is expected to be approximately $7.300 billion to $7.700 billion. In addition, the following outlook for GAAP-based financial data3 and a tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods: Twelve Months Ending March 31, 2025 GAAP-Based Financial Data* (in $ millions) GAAP Guidance Range Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 7,100 to 7,500 — 200 — — Cost of revenue 1,480 to 1,520 (40 ) — — (10 ) Operating expense 4,345 to 4,435 (70 ) — (95 ) (615 ) Income before provision for income taxes 1,329 to 1,596 110 200 95 625 Net income 904 to 1,085 Number of shares used in computation: Diluted shares 271 *The mid-point of the range has been used for purposes of presenting the reconciling items. First Quarter Fiscal Year 2025 Expectations – Ending June 30, 2024 Financial outlook metrics: Net revenue is expected to be approximately $1.575 billion to $1.675 billion. Change in deferred net revenue (online-enabled games) is expected to be approximately ($425) million. Net income is expected to be approximately $197 million to $243 million. Diluted earnings per share is expected to be approximately $0.73 to $0.90. The Company estimates a share count of 270 million for purposes of calculating diluted earnings per share. Operational outlook metric: Net bookings2 is expected to be approximately $1.150 billion to $1.250 billion. In addition, the following outlook for GAAP-based financial data3 and a tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods: Three Months Ending June 30, 2024 GAAP-Based Financial Data* (in $ millions) GAAP Guidance Range Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 1,575 to 1,675 — (425 ) — — Cost of revenue 240 to 250 (10 ) — — (5 ) Operating expense 1,065 to 1,085 (20 ) — (65 ) (135 ) Income before provision for income taxes 290 to 357 30 (425 ) 65 140 Net income 197 to 243 Number of shares used in computation: Diluted shares 270 *The mid-point of the range has been used for purposes of presenting the reconciling items. Conference Call and Supporting Documents Electronic Arts will host a conference call on May 7, 2024 at 2:00 pm PT (5:00 pm ET) to review its results for the fourth fiscal quarter and fiscal year ended March 31, 2024 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 (888) 330-2446 (domestic) or (240) 789-2732 (international), using the conference code 5939891 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 May 22, 2024 at (800) 770-2030 (domestic) or (647) 362-9199 (international) using conference code 5939891. 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 May 7, 2024” and other information regarding EA's 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: 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 and trends; the Company’s ability to develop and implement new technology; foreign currency exchange rate fluctuations; economic and geopolitical 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, 2023. These forward-looking statements are current as of May 7, 2024. 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 Annual Report on Form 10-K for the fiscal year ended March 31, 2024. Electronic Arts assumes no obligation and does not intend to update these estimates prior to filing its Form 10-K for the fiscal year ended March 31, 2024. 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 2024, EA posted GAAP net revenue of approximately $7.6 billion. Headquartered in Redwood City, California, EA is recognized for a portfolio of critically acclaimed, high-quality brands such as EA SPORTS FC™, Battlefield™, Apex Legends™, The Sims™, EA SPORTS™ Madden NFL, Need for Speed™, Titanfall™, Plants vs. Zombies™ and EA SPORTS F1®. More information about EA is available at www.ea.com/news. EA, EA SPORTS, EA SPORTS FC, Battlefield, Need for Speed, Apex Legends, The Sims, Titanfall, and Plants vs. Zombies are trademarks of Electronic Arts Inc. John Madden, NFL, FIFA and F1 are the property of their respective owners and used with permission. 1 For more information on constant currency, please refer to the earnings slides available on EA’s IR Website. 2 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. 3 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, 2023. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Statements of Operations (in $ millions, except per share data) Three Months Ended March 31, Twelve Months Ended March 31, 2024 2023 2024 2023 Net revenue 1,779 1,874 7,562 7,426 Cost of revenue 357 448 1,710 1,792 Gross profit 1,422 1,426 5,852 5,634 Operating expenses: Research and development 638 635 2,420 2,328 Marketing and sales 234 255 1,019 978 General and administrative 185 224 691 727 Amortization and impairment of intangibles 72 26 142 158 Restructuring 59 111 62 111 Total operating expenses 1,188 1,251 4,334 4,302 Operating income 234 175 1,518 1,332 Interest and other income (expense), net 26 6 71 (6 ) Income before provision for income taxes 260 181 1,589 1,326 Provision for income taxes 78 193 316 524 Net income (loss) 182 (12 ) 1,273 802 Earnings (loss) per share Basic 0.68 (0.04 ) 4.71 2.90 Diluted 0.67 (0.04 ) 4.68 2.88 Number of shares used in computation Basic 267 274 270 277 Diluted 270 274 272 278 Results (in $ millions, except per share data) The following table reports the variance of the actuals versus our guidance provided on January 30, 2024 for the three months ended March 31, 2024 plus a comparison to the actuals for the three months ended March 31, 2023. Three Months Ended March 31, 2024 Guidance (Mid-Point) 2024 Actuals 2023 Actuals Variance Net revenue Net revenue 1,775 4 1,779 1,874 GAAP-based financial data Change in deferred net revenue (online-enabled games)1 — (113 ) (113 ) 72 Cost of revenue Cost of revenue 385 (28 ) 357 448 GAAP-based financial data Acquisition-related expenses (30 ) 1 (29 ) (25 ) Stock-based compensation (5 ) 3 (2 ) (2 ) Operating expenses Operating expenses 1,165 23 1,188 1,251 GAAP-based financial data Acquisition-related expenses (75 ) 3 (72 ) (26 ) Restructuring and related charges — (61 ) (61 ) (155 ) Stock-based compensation (150 ) 4 (146 ) (140 ) Income before tax Income before tax 242 18 260 181 GAAP-based financial data Acquisition-related expenses 105 (4 ) 101 51 Change in deferred net revenue (online-enabled games)1 — (113 ) (113 ) 72 Restructuring and related charges — 61 61 155 Stock-based compensation 155 (7 ) 148 142 Tax rate used for management reporting 19 % 19 % 19 % Earnings (loss) per share Basic 0.44 0.24 0.68 (0.04 ) Diluted 0.44 0.23 0.67 (0.04 ) Number of shares used in computation Basic 269 (2 ) 267 274 Diluted 271 (1 ) 270 274 Anti-dilutive shares excluded for loss position2 — — — 1 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. 2 Diluted earnings per share reflects the potential dilution from common shares (calculated using the treasury stock method), issuable through stock-based compensation plans. When the company incurs a loss, shares issuable though stock-based compensation plans are excluded from the diluted loss per share calculation as inclusion would be anti-dilutive. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Balance Sheets (in $ millions) March 31, 2024 March 31, 20233 ASSETS Current assets: Cash and cash equivalents 2,900 2,424 Short-term investments 362 343 Receivables, net 565 684 Other current assets 420 518 Total current assets 4,247 3,969 Property and equipment, net 578 549 Goodwill 5,379 5,380 Acquisition-related intangibles, net 400 618 Deferred income taxes, net 2,380 2,462 Other assets 436 481 TOTAL ASSETS 13,420 13,459 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable 110 99 Accrued and other current liabilities 1,166 1,285 Deferred net revenue (online-enabled games) 1,814 1,901 Total current liabilities 3,090 3,285 Senior notes, net 1,882 1,880 Income tax obligations 497 607 Deferred income taxes, net 1 1 Other liabilities 437 393 Total liabilities 5,907 6,166 Stockholders’ equity: Common stock 3 3 Retained earnings 7,582 7,357 Accumulated other comprehensive loss (72 ) (67 ) Total stockholders’ equity 7,513 7,293 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY 13,420 13,459 3Derived from audited consolidated financial statements. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Statements of Cash Flows (in $ millions) Three Months Ended March 31, Twelve Months Ended March 31, 2024 2023 2024 2023 OPERATING ACTIVITIES Net income (loss) 182 (12 ) 1,273 802 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation, amortization, accretion and impairment 149 173 404 536 Stock-based compensation 148 142 584 548 Change in assets and liabilities Receivables, net 303 152 119 (34 ) Other assets (38 ) (50 ) 148 (103 ) Accounts payable 30 31 (6 ) 10 Accrued and other liabilities (83 ) 106 (202 ) 134 Deferred income taxes, net (6 ) (18 ) 82 (221 ) Deferred net revenue (online-enabled games) (105 ) 93 (87 ) (122 ) Net cash provided by operating activities 580 617 2,315 1,550 INVESTING ACTIVITIES Capital expenditures (51 ) (47 ) (199 ) (207 ) Proceeds from maturities and sales of short-term investments 182 152 632 395 Purchase of short-term investments (180 ) (142 ) (640 ) (405 ) Net cash used in investing activities (49 ) (37 ) (207 ) (217 ) FINANCING ACTIVITIES Proceeds from issuance of common stock 34 33 77 80 Cash dividends paid (51 ) (52 ) (205 ) (210 ) Cash paid to taxing authorities for shares withheld from employees (18 ) (14 ) (196 ) (175 ) Common stock repurchases (325 ) (325 ) (1,300 ) (1,295 ) Net cash used in financing activities (360 ) (358 ) (1,624 ) (1,600 ) Effect of foreign exchange on cash and cash equivalents (13 ) — (8 ) (41 ) Change in cash and cash equivalents 158 222 476 (308 ) Beginning cash and cash equivalents 2,742 2,202 2,424 2,732 Ending cash and cash equivalents 2,900 2,424 2,900 2,424 ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Supplemental Financial Information and Business Metrics (in $ millions, except per share data) Q4 Q1 Q2 Q3 Q4 YOY % FY23 FY24 FY24 FY24 FY24 Change Net revenue Net revenue 1,874 1,924 1,914 1,945 1,779 (5 %) GAAP-based financial data Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Gross profit Gross profit 1,426 1,556 1,458 1,416 1,422 — Gross profit (as a % of net revenue) 76 % 81 % 76 % 73 % 80 % GAAP-based financial data Acquisition-related expenses 25 16 15 16 29 Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Stock-based compensation 2 2 2 2 2 Operating income Operating income 175 542 377 365 234 34 % Operating income (as a % of net revenue) 9 % 28 % 20 % 19 % 13 % GAAP-based financial data Acquisition-related expenses 51 41 39 37 101 Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Restructuring and related charges 155 3 — — 61 Stock-based compensation 142 130 155 151 148 Net income (loss) Net income (loss) (12 ) 402 399 290 182 1,617 % Net income (loss) (as a % of net revenue) (1 %) 21 % 21 % 15 % 10 % GAAP-based financial data Acquisition-related expenses 51 41 39 37 101 Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Restructuring and related charges 155 3 — — 61 Stock-based compensation 142 130 155 151 148 Tax rate used for management reporting 19 % 19 % 19 % 19 % 19 % Diluted earnings (loss) per share (0.04 ) 1.47 1.47 1.07 0.67 1,775 % Number of shares used in computation Basic 274 272 271 269 267 Diluted 274 274 272 271 270 Anti-dilutive shares excluded for loss position2 1 — — — — 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. 2Diluted earnings per share reflects the potential dilution from common shares (calculated using the treasury stock method), issuable through stock-based compensation plans. When the company incurs a loss, shares issuable though stock-based compensation plans are excluded from the diluted loss per share calculation as inclusion would be anti-dilutive. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Supplemental Financial Information and Business Metrics (in $ millions) Q4 Q1 Q2 Q3 Q4 YOY % FY23 FY24 FY24 FY24 FY24 Change QUARTERLY NET REVENUE PRESENTATIONS Net revenue by composition Full game downloads 274 301 346 431 265 (3 %) Packaged goods 98 142 275 187 68 (31 %) Full game 372 443 621 618 333 (10 %) Live services and other 1,502 1,481 1,293 1,327 1,446 (4 %) Total net revenue 1,874 1,924 1,914 1,945 1,779 (5 %) Full game 20 % 23 % 32 % 32 % 19 % Live services and other 80 % 77 % 68 % 68 % 81 % Total net revenue % 100 % 100 % 100 % 100 % 100 % GAAP-based financial data Full game downloads (24 ) (21 ) 24 32 (37 ) Packaged goods (24 ) (21 ) 46 4 (37 ) Full game (48 ) (42 ) 70 36 (74 ) Live services and other 120 (304 ) (164 ) 385 (39 ) Total change in deferred net revenue (online-enabled games) by composition1 72 (346 ) (94 ) 421 (113 ) Net revenue by platform Console 1,088 1,167 1,187 1,229 1,049 (4 %) PC & Other 469 451 423 420 423 (10 %) Mobile 317 306 304 296 307 (3 %) Total net revenue 1,874 1,924 1,914 1,945 1,779 (5 %) GAAP-based financial data Console 11 (266 ) (35 ) 377 (94 ) PC & Other 47 (77 ) (34 ) 33 (10 ) Mobile 14 (3 ) (25 ) 11 (9 ) Total change in deferred net revenue (online-enabled games) by platform1 72 (346 ) (94 ) 421 (113 ) 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) Q4 Q1 Q2 Q3 Q4 YOY % FY23 FY24 FY24 FY24 FY24 Change CASH FLOW DATA Investing cash flow (37 ) (44 ) (63 ) (51 ) (49 ) Investing cash flow - TTM (217 ) (196 ) (205 ) (195 ) (207 ) 5 % Financing cash flow (358 ) (482 ) (351 ) (431 ) (360 ) Financing cash flow - TTM (1,600 ) (1,606 ) (1,609 ) (1,622 ) (1,624 ) (2 %) Operating cash flow 617 359 112 1,264 580 Operating cash flow - TTM 1,550 1,987 2,211 2,352 2,315 49 % Capital expenditures 47 45 51 52 51 Capital expenditures - TTM 207 193 191 195 199 (4 %) Free cash flow4 570 314 61 1,212 529 Free cash flow4 - TTM 1,343 1,794 2,020 2,157 2,116 58 % Common stock repurchases 325 325 325 325 325 — Cash dividends paid 52 52 51 51 51 (2 %) DEPRECIATION Depreciation expense 58 49 49 48 50 (14 %) BALANCE SHEET DATA Cash and cash equivalents 2,424 2,259 1,946 2,742 2,900 Short-term investments 343 343 359 362 362 Cash and cash equivalents, and short-term investments 2,767 2,602 2,305 3,104 3,262 18 % Receivables, net 684 517 1,047 867 565 (17 %) STOCK-BASED COMPENSATION Cost of revenue 2 2 2 2 2 Research and development 96 93 113 108 104 Marketing and sales 15 11 13 14 14 General and administrative 29 24 27 27 28 Total stock-based compensation 142 130 155 151 148 RESTRUCTURING AND RELATED CHARGES Restructuring 111 1 2 — 59 Office space reductions 44 2 (2 ) — 2 Total restructuring and related charges 155 3 — — 61 4 Free cash flow is defined as Operating cash flow less Capital expenditures. View source version on businesswire.com: https://www.businesswire.com/news/home/20240507968256/en/Contacts Andrew Uerkwitz Vice President, Investor Relations 650-674-7191 auerkwitz@ea.com Erin Rheaume Director, Financial Communications 650-628-7978 erheaume@ea.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Electronic Arts Reports Q4 and FY24 Results By: Electronic Arts Inc. via Business Wire May 07, 2024 at 16:05 PM EDT EA SPORTS™ Momentum Continued in FY24, Company Delivers Record Fiscal Year Cash Flow Electronic Arts Inc. (NASDAQ: EA) today announced preliminary financial results for its fourth quarter and fiscal year ended March 31, 2024. “This year, EA delivered bigger, bolder world class entertainment that engaged and connected hundreds of millions of players and fans,” said Andrew Wilson, CEO of EA. “We will continue to build on this strong momentum through an incredible pipeline of new experiences, starting with College Football in FY25, positioning us for accelerated growth in FY26 and beyond.” “EA’s FY24 was highlighted by record cash flow and strong earnings growth driven by EA SPORTS FC™ and Madden NFL,” said Stuart Canfield, CFO of EA. “With strong conviction in our future, we are announcing an expanded stock repurchase program. We look forward to sharing more about our long-term strategy and financial framework at our Investor Day this fall.” Selected Operating Highlights and Metrics1 Net bookings2 for FY24 was $7.430 billion, up 1% year-over-year (up 3% in constant currency). Delivered 11 titles and over 600 content updates in the year, including four non-annual sports titles and the successful rebrand of EA SPORTS FC. Our global football franchise grew net bookings by high-teens percent in FY24. During FY24, our EA SPORTS™ Madden NFL franchise delivered record net bookings, up 6% year-over-year and double-digit growth in weekly average users for both Madden NFL 24 and Madden Mobile. Selected Financial Highlights and Metrics Net revenue for FY24 was $7.562 billion, up 2% year-over-year. For FY24, net cash provided by operating activities was a fiscal year record $2.315 billion, up 49% year-over-year. During FY24, EA returned $1.505 billion to stockholders through stock repurchases and dividends. The board has authorized a new stock repurchase program of $5 billion over three years. Dividend EA has declared a quarterly cash dividend of $0.19 per share of the Company’s common stock. The dividend is payable on June 19, 2024 to stockholders of record as of the close of business on May 29, 2024. Quarterly Financial Highlights Three Months Ended March 31, (in $ millions, except per share amounts) 2024 2023 Full game 333 372 Live services and other 1,446 1,502 Total net revenue 1,779 1,874 Net income (loss) 182 (12 ) Diluted earnings (loss) per share 0.67 (0.04 ) Operating cash flow 580 617 Value of shares repurchased 325 325 Number of shares repurchased 2.3 2.7 Cash dividend paid 51 52 The following GAAP-based financial data3 and tax rate of 19% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results: Three Months Ended March 31, 2024 GAAP-Based Financial Data (in $ millions) Statement of Operations Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 1,779 — (113 ) — — Cost of revenue 357 (29 ) — — (2 ) Gross profit 1,422 29 (113 ) — 2 Total operating expenses 1,188 (72 ) — (61 ) (146 ) Operating income 234 101 (113 ) 61 148 Interest and other income (expense), net 26 — — — — Income before provision for income taxes 260 101 (113 ) 61 148 Number of shares used in computation: Diluted 270 Fiscal Year Financial Highlights Twelve Months Ended March 31, (in $ millions, except per share amounts) 2024 2023 Full game 2,015 1,937 Live services and other 5,547 5,489 Total net revenue 7,562 7,426 Net income 1,273 802 Diluted earnings per share 4.68 2.88 Operating cash flow 2,315 1,550 Value of shares repurchased 1,300 1,295 Number of shares repurchased 10.0 10.4 Cash dividend paid 205 210 The following GAAP-based financial data3 and a tax rate of 19% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results. Twelve Months Ended March 31, 2024 GAAP-Based Financial Data (in $ millions) Statement of Operations Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 7,562 — (132 ) — — Cost of revenue 1,710 (76 ) — — (8 ) Gross profit 5,852 76 (132 ) — 8 Total operating expenses 4,334 (142 ) — (64 ) (576 ) Operating income 1,518 218 (132 ) 64 584 Interest and other income (expense), net 71 — — — — Income before provision for income taxes 1,589 218 (132 ) 64 584 Number of shares used in computation: Diluted 272 Operating Metric The following is a calculation of our total net bookings2 for the periods presented: Three Months Ended March 31, Twelve Months Ended March 31, (in $ millions) 2024 2023 2024 2023 Total net revenue 1,779 1,874 7,562 7,426 Change in deferred net revenue (online-enabled games) (113 ) 72 (132 ) (85 ) Total net bookings 1,666 1,946 7,430 7,341 Business Outlook as of May 7, 2024 Fiscal Year 2025 Expectations – Ending March 31, 2025 Financial outlook metrics: Net revenue is expected to be approximately $7.100 billion to $7.500 billion. Change in deferred net revenue (online-enabled games) is expected to be approximately $200 million. Net income is expected to be approximately $904 million to $1.085 billion. Diluted earnings per share is expected to be approximately $3.34 to $4.00. Operating cash flow is expected to be approximately $2.050 billion to $2.250 billion. The Company estimates a share count of 271 million for purposes of calculating diluted earnings per share. Operational outlook metric: Net bookings2 is expected to be approximately $7.300 billion to $7.700 billion. In addition, the following outlook for GAAP-based financial data3 and a tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods: Twelve Months Ending March 31, 2025 GAAP-Based Financial Data* (in $ millions) GAAP Guidance Range Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 7,100 to 7,500 — 200 — — Cost of revenue 1,480 to 1,520 (40 ) — — (10 ) Operating expense 4,345 to 4,435 (70 ) — (95 ) (615 ) Income before provision for income taxes 1,329 to 1,596 110 200 95 625 Net income 904 to 1,085 Number of shares used in computation: Diluted shares 271 *The mid-point of the range has been used for purposes of presenting the reconciling items. First Quarter Fiscal Year 2025 Expectations – Ending June 30, 2024 Financial outlook metrics: Net revenue is expected to be approximately $1.575 billion to $1.675 billion. Change in deferred net revenue (online-enabled games) is expected to be approximately ($425) million. Net income is expected to be approximately $197 million to $243 million. Diluted earnings per share is expected to be approximately $0.73 to $0.90. The Company estimates a share count of 270 million for purposes of calculating diluted earnings per share. Operational outlook metric: Net bookings2 is expected to be approximately $1.150 billion to $1.250 billion. In addition, the following outlook for GAAP-based financial data3 and a tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods: Three Months Ending June 30, 2024 GAAP-Based Financial Data* (in $ millions) GAAP Guidance Range Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 1,575 to 1,675 — (425 ) — — Cost of revenue 240 to 250 (10 ) — — (5 ) Operating expense 1,065 to 1,085 (20 ) — (65 ) (135 ) Income before provision for income taxes 290 to 357 30 (425 ) 65 140 Net income 197 to 243 Number of shares used in computation: Diluted shares 270 *The mid-point of the range has been used for purposes of presenting the reconciling items. Conference Call and Supporting Documents Electronic Arts will host a conference call on May 7, 2024 at 2:00 pm PT (5:00 pm ET) to review its results for the fourth fiscal quarter and fiscal year ended March 31, 2024 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 (888) 330-2446 (domestic) or (240) 789-2732 (international), using the conference code 5939891 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 May 22, 2024 at (800) 770-2030 (domestic) or (647) 362-9199 (international) using conference code 5939891. 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 May 7, 2024” and other information regarding EA's 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: 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 and trends; the Company’s ability to develop and implement new technology; foreign currency exchange rate fluctuations; economic and geopolitical 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, 2023. These forward-looking statements are current as of May 7, 2024. 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 Annual Report on Form 10-K for the fiscal year ended March 31, 2024. Electronic Arts assumes no obligation and does not intend to update these estimates prior to filing its Form 10-K for the fiscal year ended March 31, 2024. 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 2024, EA posted GAAP net revenue of approximately $7.6 billion. Headquartered in Redwood City, California, EA is recognized for a portfolio of critically acclaimed, high-quality brands such as EA SPORTS FC™, Battlefield™, Apex Legends™, The Sims™, EA SPORTS™ Madden NFL, Need for Speed™, Titanfall™, Plants vs. Zombies™ and EA SPORTS F1®. More information about EA is available at www.ea.com/news. EA, EA SPORTS, EA SPORTS FC, Battlefield, Need for Speed, Apex Legends, The Sims, Titanfall, and Plants vs. Zombies are trademarks of Electronic Arts Inc. John Madden, NFL, FIFA and F1 are the property of their respective owners and used with permission. 1 For more information on constant currency, please refer to the earnings slides available on EA’s IR Website. 2 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. 3 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, 2023. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Statements of Operations (in $ millions, except per share data) Three Months Ended March 31, Twelve Months Ended March 31, 2024 2023 2024 2023 Net revenue 1,779 1,874 7,562 7,426 Cost of revenue 357 448 1,710 1,792 Gross profit 1,422 1,426 5,852 5,634 Operating expenses: Research and development 638 635 2,420 2,328 Marketing and sales 234 255 1,019 978 General and administrative 185 224 691 727 Amortization and impairment of intangibles 72 26 142 158 Restructuring 59 111 62 111 Total operating expenses 1,188 1,251 4,334 4,302 Operating income 234 175 1,518 1,332 Interest and other income (expense), net 26 6 71 (6 ) Income before provision for income taxes 260 181 1,589 1,326 Provision for income taxes 78 193 316 524 Net income (loss) 182 (12 ) 1,273 802 Earnings (loss) per share Basic 0.68 (0.04 ) 4.71 2.90 Diluted 0.67 (0.04 ) 4.68 2.88 Number of shares used in computation Basic 267 274 270 277 Diluted 270 274 272 278 Results (in $ millions, except per share data) The following table reports the variance of the actuals versus our guidance provided on January 30, 2024 for the three months ended March 31, 2024 plus a comparison to the actuals for the three months ended March 31, 2023. Three Months Ended March 31, 2024 Guidance (Mid-Point) 2024 Actuals 2023 Actuals Variance Net revenue Net revenue 1,775 4 1,779 1,874 GAAP-based financial data Change in deferred net revenue (online-enabled games)1 — (113 ) (113 ) 72 Cost of revenue Cost of revenue 385 (28 ) 357 448 GAAP-based financial data Acquisition-related expenses (30 ) 1 (29 ) (25 ) Stock-based compensation (5 ) 3 (2 ) (2 ) Operating expenses Operating expenses 1,165 23 1,188 1,251 GAAP-based financial data Acquisition-related expenses (75 ) 3 (72 ) (26 ) Restructuring and related charges — (61 ) (61 ) (155 ) Stock-based compensation (150 ) 4 (146 ) (140 ) Income before tax Income before tax 242 18 260 181 GAAP-based financial data Acquisition-related expenses 105 (4 ) 101 51 Change in deferred net revenue (online-enabled games)1 — (113 ) (113 ) 72 Restructuring and related charges — 61 61 155 Stock-based compensation 155 (7 ) 148 142 Tax rate used for management reporting 19 % 19 % 19 % Earnings (loss) per share Basic 0.44 0.24 0.68 (0.04 ) Diluted 0.44 0.23 0.67 (0.04 ) Number of shares used in computation Basic 269 (2 ) 267 274 Diluted 271 (1 ) 270 274 Anti-dilutive shares excluded for loss position2 — — — 1 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. 2 Diluted earnings per share reflects the potential dilution from common shares (calculated using the treasury stock method), issuable through stock-based compensation plans. When the company incurs a loss, shares issuable though stock-based compensation plans are excluded from the diluted loss per share calculation as inclusion would be anti-dilutive. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Balance Sheets (in $ millions) March 31, 2024 March 31, 20233 ASSETS Current assets: Cash and cash equivalents 2,900 2,424 Short-term investments 362 343 Receivables, net 565 684 Other current assets 420 518 Total current assets 4,247 3,969 Property and equipment, net 578 549 Goodwill 5,379 5,380 Acquisition-related intangibles, net 400 618 Deferred income taxes, net 2,380 2,462 Other assets 436 481 TOTAL ASSETS 13,420 13,459 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable 110 99 Accrued and other current liabilities 1,166 1,285 Deferred net revenue (online-enabled games) 1,814 1,901 Total current liabilities 3,090 3,285 Senior notes, net 1,882 1,880 Income tax obligations 497 607 Deferred income taxes, net 1 1 Other liabilities 437 393 Total liabilities 5,907 6,166 Stockholders’ equity: Common stock 3 3 Retained earnings 7,582 7,357 Accumulated other comprehensive loss (72 ) (67 ) Total stockholders’ equity 7,513 7,293 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY 13,420 13,459 3Derived from audited consolidated financial statements. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Statements of Cash Flows (in $ millions) Three Months Ended March 31, Twelve Months Ended March 31, 2024 2023 2024 2023 OPERATING ACTIVITIES Net income (loss) 182 (12 ) 1,273 802 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation, amortization, accretion and impairment 149 173 404 536 Stock-based compensation 148 142 584 548 Change in assets and liabilities Receivables, net 303 152 119 (34 ) Other assets (38 ) (50 ) 148 (103 ) Accounts payable 30 31 (6 ) 10 Accrued and other liabilities (83 ) 106 (202 ) 134 Deferred income taxes, net (6 ) (18 ) 82 (221 ) Deferred net revenue (online-enabled games) (105 ) 93 (87 ) (122 ) Net cash provided by operating activities 580 617 2,315 1,550 INVESTING ACTIVITIES Capital expenditures (51 ) (47 ) (199 ) (207 ) Proceeds from maturities and sales of short-term investments 182 152 632 395 Purchase of short-term investments (180 ) (142 ) (640 ) (405 ) Net cash used in investing activities (49 ) (37 ) (207 ) (217 ) FINANCING ACTIVITIES Proceeds from issuance of common stock 34 33 77 80 Cash dividends paid (51 ) (52 ) (205 ) (210 ) Cash paid to taxing authorities for shares withheld from employees (18 ) (14 ) (196 ) (175 ) Common stock repurchases (325 ) (325 ) (1,300 ) (1,295 ) Net cash used in financing activities (360 ) (358 ) (1,624 ) (1,600 ) Effect of foreign exchange on cash and cash equivalents (13 ) — (8 ) (41 ) Change in cash and cash equivalents 158 222 476 (308 ) Beginning cash and cash equivalents 2,742 2,202 2,424 2,732 Ending cash and cash equivalents 2,900 2,424 2,900 2,424 ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Supplemental Financial Information and Business Metrics (in $ millions, except per share data) Q4 Q1 Q2 Q3 Q4 YOY % FY23 FY24 FY24 FY24 FY24 Change Net revenue Net revenue 1,874 1,924 1,914 1,945 1,779 (5 %) GAAP-based financial data Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Gross profit Gross profit 1,426 1,556 1,458 1,416 1,422 — Gross profit (as a % of net revenue) 76 % 81 % 76 % 73 % 80 % GAAP-based financial data Acquisition-related expenses 25 16 15 16 29 Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Stock-based compensation 2 2 2 2 2 Operating income Operating income 175 542 377 365 234 34 % Operating income (as a % of net revenue) 9 % 28 % 20 % 19 % 13 % GAAP-based financial data Acquisition-related expenses 51 41 39 37 101 Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Restructuring and related charges 155 3 — — 61 Stock-based compensation 142 130 155 151 148 Net income (loss) Net income (loss) (12 ) 402 399 290 182 1,617 % Net income (loss) (as a % of net revenue) (1 %) 21 % 21 % 15 % 10 % GAAP-based financial data Acquisition-related expenses 51 41 39 37 101 Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Restructuring and related charges 155 3 — — 61 Stock-based compensation 142 130 155 151 148 Tax rate used for management reporting 19 % 19 % 19 % 19 % 19 % Diluted earnings (loss) per share (0.04 ) 1.47 1.47 1.07 0.67 1,775 % Number of shares used in computation Basic 274 272 271 269 267 Diluted 274 274 272 271 270 Anti-dilutive shares excluded for loss position2 1 — — — — 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. 2Diluted earnings per share reflects the potential dilution from common shares (calculated using the treasury stock method), issuable through stock-based compensation plans. When the company incurs a loss, shares issuable though stock-based compensation plans are excluded from the diluted loss per share calculation as inclusion would be anti-dilutive. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Supplemental Financial Information and Business Metrics (in $ millions) Q4 Q1 Q2 Q3 Q4 YOY % FY23 FY24 FY24 FY24 FY24 Change QUARTERLY NET REVENUE PRESENTATIONS Net revenue by composition Full game downloads 274 301 346 431 265 (3 %) Packaged goods 98 142 275 187 68 (31 %) Full game 372 443 621 618 333 (10 %) Live services and other 1,502 1,481 1,293 1,327 1,446 (4 %) Total net revenue 1,874 1,924 1,914 1,945 1,779 (5 %) Full game 20 % 23 % 32 % 32 % 19 % Live services and other 80 % 77 % 68 % 68 % 81 % Total net revenue % 100 % 100 % 100 % 100 % 100 % GAAP-based financial data Full game downloads (24 ) (21 ) 24 32 (37 ) Packaged goods (24 ) (21 ) 46 4 (37 ) Full game (48 ) (42 ) 70 36 (74 ) Live services and other 120 (304 ) (164 ) 385 (39 ) Total change in deferred net revenue (online-enabled games) by composition1 72 (346 ) (94 ) 421 (113 ) Net revenue by platform Console 1,088 1,167 1,187 1,229 1,049 (4 %) PC & Other 469 451 423 420 423 (10 %) Mobile 317 306 304 296 307 (3 %) Total net revenue 1,874 1,924 1,914 1,945 1,779 (5 %) GAAP-based financial data Console 11 (266 ) (35 ) 377 (94 ) PC & Other 47 (77 ) (34 ) 33 (10 ) Mobile 14 (3 ) (25 ) 11 (9 ) Total change in deferred net revenue (online-enabled games) by platform1 72 (346 ) (94 ) 421 (113 ) 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) Q4 Q1 Q2 Q3 Q4 YOY % FY23 FY24 FY24 FY24 FY24 Change CASH FLOW DATA Investing cash flow (37 ) (44 ) (63 ) (51 ) (49 ) Investing cash flow - TTM (217 ) (196 ) (205 ) (195 ) (207 ) 5 % Financing cash flow (358 ) (482 ) (351 ) (431 ) (360 ) Financing cash flow - TTM (1,600 ) (1,606 ) (1,609 ) (1,622 ) (1,624 ) (2 %) Operating cash flow 617 359 112 1,264 580 Operating cash flow - TTM 1,550 1,987 2,211 2,352 2,315 49 % Capital expenditures 47 45 51 52 51 Capital expenditures - TTM 207 193 191 195 199 (4 %) Free cash flow4 570 314 61 1,212 529 Free cash flow4 - TTM 1,343 1,794 2,020 2,157 2,116 58 % Common stock repurchases 325 325 325 325 325 — Cash dividends paid 52 52 51 51 51 (2 %) DEPRECIATION Depreciation expense 58 49 49 48 50 (14 %) BALANCE SHEET DATA Cash and cash equivalents 2,424 2,259 1,946 2,742 2,900 Short-term investments 343 343 359 362 362 Cash and cash equivalents, and short-term investments 2,767 2,602 2,305 3,104 3,262 18 % Receivables, net 684 517 1,047 867 565 (17 %) STOCK-BASED COMPENSATION Cost of revenue 2 2 2 2 2 Research and development 96 93 113 108 104 Marketing and sales 15 11 13 14 14 General and administrative 29 24 27 27 28 Total stock-based compensation 142 130 155 151 148 RESTRUCTURING AND RELATED CHARGES Restructuring 111 1 2 — 59 Office space reductions 44 2 (2 ) — 2 Total restructuring and related charges 155 3 — — 61 4 Free cash flow is defined as Operating cash flow less Capital expenditures. View source version on businesswire.com: https://www.businesswire.com/news/home/20240507968256/en/Contacts Andrew Uerkwitz Vice President, Investor Relations 650-674-7191 auerkwitz@ea.com Erin Rheaume Director, Financial Communications 650-628-7978 erheaume@ea.com
Electronic Arts Inc. (NASDAQ: EA) today announced preliminary financial results for its fourth quarter and fiscal year ended March 31, 2024. “This year, EA delivered bigger, bolder world class entertainment that engaged and connected hundreds of millions of players and fans,” said Andrew Wilson, CEO of EA. “We will continue to build on this strong momentum through an incredible pipeline of new experiences, starting with College Football in FY25, positioning us for accelerated growth in FY26 and beyond.” “EA’s FY24 was highlighted by record cash flow and strong earnings growth driven by EA SPORTS FC™ and Madden NFL,” said Stuart Canfield, CFO of EA. “With strong conviction in our future, we are announcing an expanded stock repurchase program. We look forward to sharing more about our long-term strategy and financial framework at our Investor Day this fall.” Selected Operating Highlights and Metrics1 Net bookings2 for FY24 was $7.430 billion, up 1% year-over-year (up 3% in constant currency). Delivered 11 titles and over 600 content updates in the year, including four non-annual sports titles and the successful rebrand of EA SPORTS FC. Our global football franchise grew net bookings by high-teens percent in FY24. During FY24, our EA SPORTS™ Madden NFL franchise delivered record net bookings, up 6% year-over-year and double-digit growth in weekly average users for both Madden NFL 24 and Madden Mobile. Selected Financial Highlights and Metrics Net revenue for FY24 was $7.562 billion, up 2% year-over-year. For FY24, net cash provided by operating activities was a fiscal year record $2.315 billion, up 49% year-over-year. During FY24, EA returned $1.505 billion to stockholders through stock repurchases and dividends. The board has authorized a new stock repurchase program of $5 billion over three years. Dividend EA has declared a quarterly cash dividend of $0.19 per share of the Company’s common stock. The dividend is payable on June 19, 2024 to stockholders of record as of the close of business on May 29, 2024. Quarterly Financial Highlights Three Months Ended March 31, (in $ millions, except per share amounts) 2024 2023 Full game 333 372 Live services and other 1,446 1,502 Total net revenue 1,779 1,874 Net income (loss) 182 (12 ) Diluted earnings (loss) per share 0.67 (0.04 ) Operating cash flow 580 617 Value of shares repurchased 325 325 Number of shares repurchased 2.3 2.7 Cash dividend paid 51 52 The following GAAP-based financial data3 and tax rate of 19% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results: Three Months Ended March 31, 2024 GAAP-Based Financial Data (in $ millions) Statement of Operations Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 1,779 — (113 ) — — Cost of revenue 357 (29 ) — — (2 ) Gross profit 1,422 29 (113 ) — 2 Total operating expenses 1,188 (72 ) — (61 ) (146 ) Operating income 234 101 (113 ) 61 148 Interest and other income (expense), net 26 — — — — Income before provision for income taxes 260 101 (113 ) 61 148 Number of shares used in computation: Diluted 270 Fiscal Year Financial Highlights Twelve Months Ended March 31, (in $ millions, except per share amounts) 2024 2023 Full game 2,015 1,937 Live services and other 5,547 5,489 Total net revenue 7,562 7,426 Net income 1,273 802 Diluted earnings per share 4.68 2.88 Operating cash flow 2,315 1,550 Value of shares repurchased 1,300 1,295 Number of shares repurchased 10.0 10.4 Cash dividend paid 205 210 The following GAAP-based financial data3 and a tax rate of 19% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results. Twelve Months Ended March 31, 2024 GAAP-Based Financial Data (in $ millions) Statement of Operations Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 7,562 — (132 ) — — Cost of revenue 1,710 (76 ) — — (8 ) Gross profit 5,852 76 (132 ) — 8 Total operating expenses 4,334 (142 ) — (64 ) (576 ) Operating income 1,518 218 (132 ) 64 584 Interest and other income (expense), net 71 — — — — Income before provision for income taxes 1,589 218 (132 ) 64 584 Number of shares used in computation: Diluted 272 Operating Metric The following is a calculation of our total net bookings2 for the periods presented: Three Months Ended March 31, Twelve Months Ended March 31, (in $ millions) 2024 2023 2024 2023 Total net revenue 1,779 1,874 7,562 7,426 Change in deferred net revenue (online-enabled games) (113 ) 72 (132 ) (85 ) Total net bookings 1,666 1,946 7,430 7,341 Business Outlook as of May 7, 2024 Fiscal Year 2025 Expectations – Ending March 31, 2025 Financial outlook metrics: Net revenue is expected to be approximately $7.100 billion to $7.500 billion. Change in deferred net revenue (online-enabled games) is expected to be approximately $200 million. Net income is expected to be approximately $904 million to $1.085 billion. Diluted earnings per share is expected to be approximately $3.34 to $4.00. Operating cash flow is expected to be approximately $2.050 billion to $2.250 billion. The Company estimates a share count of 271 million for purposes of calculating diluted earnings per share. Operational outlook metric: Net bookings2 is expected to be approximately $7.300 billion to $7.700 billion. In addition, the following outlook for GAAP-based financial data3 and a tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods: Twelve Months Ending March 31, 2025 GAAP-Based Financial Data* (in $ millions) GAAP Guidance Range Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 7,100 to 7,500 — 200 — — Cost of revenue 1,480 to 1,520 (40 ) — — (10 ) Operating expense 4,345 to 4,435 (70 ) — (95 ) (615 ) Income before provision for income taxes 1,329 to 1,596 110 200 95 625 Net income 904 to 1,085 Number of shares used in computation: Diluted shares 271 *The mid-point of the range has been used for purposes of presenting the reconciling items. First Quarter Fiscal Year 2025 Expectations – Ending June 30, 2024 Financial outlook metrics: Net revenue is expected to be approximately $1.575 billion to $1.675 billion. Change in deferred net revenue (online-enabled games) is expected to be approximately ($425) million. Net income is expected to be approximately $197 million to $243 million. Diluted earnings per share is expected to be approximately $0.73 to $0.90. The Company estimates a share count of 270 million for purposes of calculating diluted earnings per share. Operational outlook metric: Net bookings2 is expected to be approximately $1.150 billion to $1.250 billion. In addition, the following outlook for GAAP-based financial data3 and a tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods: Three Months Ending June 30, 2024 GAAP-Based Financial Data* (in $ millions) GAAP Guidance Range Acquisition-related expenses Change in deferred net revenue (online-enabled games) Restructuring and related charges Stock-based compensation Total net revenue 1,575 to 1,675 — (425 ) — — Cost of revenue 240 to 250 (10 ) — — (5 ) Operating expense 1,065 to 1,085 (20 ) — (65 ) (135 ) Income before provision for income taxes 290 to 357 30 (425 ) 65 140 Net income 197 to 243 Number of shares used in computation: Diluted shares 270 *The mid-point of the range has been used for purposes of presenting the reconciling items. Conference Call and Supporting Documents Electronic Arts will host a conference call on May 7, 2024 at 2:00 pm PT (5:00 pm ET) to review its results for the fourth fiscal quarter and fiscal year ended March 31, 2024 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 (888) 330-2446 (domestic) or (240) 789-2732 (international), using the conference code 5939891 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 May 22, 2024 at (800) 770-2030 (domestic) or (647) 362-9199 (international) using conference code 5939891. 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 May 7, 2024” and other information regarding EA's 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: 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 and trends; the Company’s ability to develop and implement new technology; foreign currency exchange rate fluctuations; economic and geopolitical 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, 2023. These forward-looking statements are current as of May 7, 2024. 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 Annual Report on Form 10-K for the fiscal year ended March 31, 2024. Electronic Arts assumes no obligation and does not intend to update these estimates prior to filing its Form 10-K for the fiscal year ended March 31, 2024. 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 2024, EA posted GAAP net revenue of approximately $7.6 billion. Headquartered in Redwood City, California, EA is recognized for a portfolio of critically acclaimed, high-quality brands such as EA SPORTS FC™, Battlefield™, Apex Legends™, The Sims™, EA SPORTS™ Madden NFL, Need for Speed™, Titanfall™, Plants vs. Zombies™ and EA SPORTS F1®. More information about EA is available at www.ea.com/news. EA, EA SPORTS, EA SPORTS FC, Battlefield, Need for Speed, Apex Legends, The Sims, Titanfall, and Plants vs. Zombies are trademarks of Electronic Arts Inc. John Madden, NFL, FIFA and F1 are the property of their respective owners and used with permission. 1 For more information on constant currency, please refer to the earnings slides available on EA’s IR Website. 2 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. 3 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, 2023. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Statements of Operations (in $ millions, except per share data) Three Months Ended March 31, Twelve Months Ended March 31, 2024 2023 2024 2023 Net revenue 1,779 1,874 7,562 7,426 Cost of revenue 357 448 1,710 1,792 Gross profit 1,422 1,426 5,852 5,634 Operating expenses: Research and development 638 635 2,420 2,328 Marketing and sales 234 255 1,019 978 General and administrative 185 224 691 727 Amortization and impairment of intangibles 72 26 142 158 Restructuring 59 111 62 111 Total operating expenses 1,188 1,251 4,334 4,302 Operating income 234 175 1,518 1,332 Interest and other income (expense), net 26 6 71 (6 ) Income before provision for income taxes 260 181 1,589 1,326 Provision for income taxes 78 193 316 524 Net income (loss) 182 (12 ) 1,273 802 Earnings (loss) per share Basic 0.68 (0.04 ) 4.71 2.90 Diluted 0.67 (0.04 ) 4.68 2.88 Number of shares used in computation Basic 267 274 270 277 Diluted 270 274 272 278 Results (in $ millions, except per share data) The following table reports the variance of the actuals versus our guidance provided on January 30, 2024 for the three months ended March 31, 2024 plus a comparison to the actuals for the three months ended March 31, 2023. Three Months Ended March 31, 2024 Guidance (Mid-Point) 2024 Actuals 2023 Actuals Variance Net revenue Net revenue 1,775 4 1,779 1,874 GAAP-based financial data Change in deferred net revenue (online-enabled games)1 — (113 ) (113 ) 72 Cost of revenue Cost of revenue 385 (28 ) 357 448 GAAP-based financial data Acquisition-related expenses (30 ) 1 (29 ) (25 ) Stock-based compensation (5 ) 3 (2 ) (2 ) Operating expenses Operating expenses 1,165 23 1,188 1,251 GAAP-based financial data Acquisition-related expenses (75 ) 3 (72 ) (26 ) Restructuring and related charges — (61 ) (61 ) (155 ) Stock-based compensation (150 ) 4 (146 ) (140 ) Income before tax Income before tax 242 18 260 181 GAAP-based financial data Acquisition-related expenses 105 (4 ) 101 51 Change in deferred net revenue (online-enabled games)1 — (113 ) (113 ) 72 Restructuring and related charges — 61 61 155 Stock-based compensation 155 (7 ) 148 142 Tax rate used for management reporting 19 % 19 % 19 % Earnings (loss) per share Basic 0.44 0.24 0.68 (0.04 ) Diluted 0.44 0.23 0.67 (0.04 ) Number of shares used in computation Basic 269 (2 ) 267 274 Diluted 271 (1 ) 270 274 Anti-dilutive shares excluded for loss position2 — — — 1 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. 2 Diluted earnings per share reflects the potential dilution from common shares (calculated using the treasury stock method), issuable through stock-based compensation plans. When the company incurs a loss, shares issuable though stock-based compensation plans are excluded from the diluted loss per share calculation as inclusion would be anti-dilutive. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Balance Sheets (in $ millions) March 31, 2024 March 31, 20233 ASSETS Current assets: Cash and cash equivalents 2,900 2,424 Short-term investments 362 343 Receivables, net 565 684 Other current assets 420 518 Total current assets 4,247 3,969 Property and equipment, net 578 549 Goodwill 5,379 5,380 Acquisition-related intangibles, net 400 618 Deferred income taxes, net 2,380 2,462 Other assets 436 481 TOTAL ASSETS 13,420 13,459 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable 110 99 Accrued and other current liabilities 1,166 1,285 Deferred net revenue (online-enabled games) 1,814 1,901 Total current liabilities 3,090 3,285 Senior notes, net 1,882 1,880 Income tax obligations 497 607 Deferred income taxes, net 1 1 Other liabilities 437 393 Total liabilities 5,907 6,166 Stockholders’ equity: Common stock 3 3 Retained earnings 7,582 7,357 Accumulated other comprehensive loss (72 ) (67 ) Total stockholders’ equity 7,513 7,293 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY 13,420 13,459 3Derived from audited consolidated financial statements. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Statements of Cash Flows (in $ millions) Three Months Ended March 31, Twelve Months Ended March 31, 2024 2023 2024 2023 OPERATING ACTIVITIES Net income (loss) 182 (12 ) 1,273 802 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation, amortization, accretion and impairment 149 173 404 536 Stock-based compensation 148 142 584 548 Change in assets and liabilities Receivables, net 303 152 119 (34 ) Other assets (38 ) (50 ) 148 (103 ) Accounts payable 30 31 (6 ) 10 Accrued and other liabilities (83 ) 106 (202 ) 134 Deferred income taxes, net (6 ) (18 ) 82 (221 ) Deferred net revenue (online-enabled games) (105 ) 93 (87 ) (122 ) Net cash provided by operating activities 580 617 2,315 1,550 INVESTING ACTIVITIES Capital expenditures (51 ) (47 ) (199 ) (207 ) Proceeds from maturities and sales of short-term investments 182 152 632 395 Purchase of short-term investments (180 ) (142 ) (640 ) (405 ) Net cash used in investing activities (49 ) (37 ) (207 ) (217 ) FINANCING ACTIVITIES Proceeds from issuance of common stock 34 33 77 80 Cash dividends paid (51 ) (52 ) (205 ) (210 ) Cash paid to taxing authorities for shares withheld from employees (18 ) (14 ) (196 ) (175 ) Common stock repurchases (325 ) (325 ) (1,300 ) (1,295 ) Net cash used in financing activities (360 ) (358 ) (1,624 ) (1,600 ) Effect of foreign exchange on cash and cash equivalents (13 ) — (8 ) (41 ) Change in cash and cash equivalents 158 222 476 (308 ) Beginning cash and cash equivalents 2,742 2,202 2,424 2,732 Ending cash and cash equivalents 2,900 2,424 2,900 2,424 ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Supplemental Financial Information and Business Metrics (in $ millions, except per share data) Q4 Q1 Q2 Q3 Q4 YOY % FY23 FY24 FY24 FY24 FY24 Change Net revenue Net revenue 1,874 1,924 1,914 1,945 1,779 (5 %) GAAP-based financial data Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Gross profit Gross profit 1,426 1,556 1,458 1,416 1,422 — Gross profit (as a % of net revenue) 76 % 81 % 76 % 73 % 80 % GAAP-based financial data Acquisition-related expenses 25 16 15 16 29 Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Stock-based compensation 2 2 2 2 2 Operating income Operating income 175 542 377 365 234 34 % Operating income (as a % of net revenue) 9 % 28 % 20 % 19 % 13 % GAAP-based financial data Acquisition-related expenses 51 41 39 37 101 Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Restructuring and related charges 155 3 — — 61 Stock-based compensation 142 130 155 151 148 Net income (loss) Net income (loss) (12 ) 402 399 290 182 1,617 % Net income (loss) (as a % of net revenue) (1 %) 21 % 21 % 15 % 10 % GAAP-based financial data Acquisition-related expenses 51 41 39 37 101 Change in deferred net revenue (online-enabled games)1 72 (346 ) (94 ) 421 (113 ) Restructuring and related charges 155 3 — — 61 Stock-based compensation 142 130 155 151 148 Tax rate used for management reporting 19 % 19 % 19 % 19 % 19 % Diluted earnings (loss) per share (0.04 ) 1.47 1.47 1.07 0.67 1,775 % Number of shares used in computation Basic 274 272 271 269 267 Diluted 274 274 272 271 270 Anti-dilutive shares excluded for loss position2 1 — — — — 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. 2Diluted earnings per share reflects the potential dilution from common shares (calculated using the treasury stock method), issuable through stock-based compensation plans. When the company incurs a loss, shares issuable though stock-based compensation plans are excluded from the diluted loss per share calculation as inclusion would be anti-dilutive. ELECTRONIC ARTS INC. AND SUBSIDIARIES Unaudited Supplemental Financial Information and Business Metrics (in $ millions) Q4 Q1 Q2 Q3 Q4 YOY % FY23 FY24 FY24 FY24 FY24 Change QUARTERLY NET REVENUE PRESENTATIONS Net revenue by composition Full game downloads 274 301 346 431 265 (3 %) Packaged goods 98 142 275 187 68 (31 %) Full game 372 443 621 618 333 (10 %) Live services and other 1,502 1,481 1,293 1,327 1,446 (4 %) Total net revenue 1,874 1,924 1,914 1,945 1,779 (5 %) Full game 20 % 23 % 32 % 32 % 19 % Live services and other 80 % 77 % 68 % 68 % 81 % Total net revenue % 100 % 100 % 100 % 100 % 100 % GAAP-based financial data Full game downloads (24 ) (21 ) 24 32 (37 ) Packaged goods (24 ) (21 ) 46 4 (37 ) Full game (48 ) (42 ) 70 36 (74 ) Live services and other 120 (304 ) (164 ) 385 (39 ) Total change in deferred net revenue (online-enabled games) by composition1 72 (346 ) (94 ) 421 (113 ) Net revenue by platform Console 1,088 1,167 1,187 1,229 1,049 (4 %) PC & Other 469 451 423 420 423 (10 %) Mobile 317 306 304 296 307 (3 %) Total net revenue 1,874 1,924 1,914 1,945 1,779 (5 %) GAAP-based financial data Console 11 (266 ) (35 ) 377 (94 ) PC & Other 47 (77 ) (34 ) 33 (10 ) Mobile 14 (3 ) (25 ) 11 (9 ) Total change in deferred net revenue (online-enabled games) by platform1 72 (346 ) (94 ) 421 (113 ) 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) Q4 Q1 Q2 Q3 Q4 YOY % FY23 FY24 FY24 FY24 FY24 Change CASH FLOW DATA Investing cash flow (37 ) (44 ) (63 ) (51 ) (49 ) Investing cash flow - TTM (217 ) (196 ) (205 ) (195 ) (207 ) 5 % Financing cash flow (358 ) (482 ) (351 ) (431 ) (360 ) Financing cash flow - TTM (1,600 ) (1,606 ) (1,609 ) (1,622 ) (1,624 ) (2 %) Operating cash flow 617 359 112 1,264 580 Operating cash flow - TTM 1,550 1,987 2,211 2,352 2,315 49 % Capital expenditures 47 45 51 52 51 Capital expenditures - TTM 207 193 191 195 199 (4 %) Free cash flow4 570 314 61 1,212 529 Free cash flow4 - TTM 1,343 1,794 2,020 2,157 2,116 58 % Common stock repurchases 325 325 325 325 325 — Cash dividends paid 52 52 51 51 51 (2 %) DEPRECIATION Depreciation expense 58 49 49 48 50 (14 %) BALANCE SHEET DATA Cash and cash equivalents 2,424 2,259 1,946 2,742 2,900 Short-term investments 343 343 359 362 362 Cash and cash equivalents, and short-term investments 2,767 2,602 2,305 3,104 3,262 18 % Receivables, net 684 517 1,047 867 565 (17 %) STOCK-BASED COMPENSATION Cost of revenue 2 2 2 2 2 Research and development 96 93 113 108 104 Marketing and sales 15 11 13 14 14 General and administrative 29 24 27 27 28 Total stock-based compensation 142 130 155 151 148 RESTRUCTURING AND RELATED CHARGES Restructuring 111 1 2 — 59 Office space reductions 44 2 (2 ) — 2 Total restructuring and related charges 155 3 — — 61 4 Free cash flow is defined as Operating cash flow less Capital expenditures. 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Andrew Uerkwitz Vice President, Investor Relations 650-674-7191 auerkwitz@ea.com Erin Rheaume Director, Financial Communications 650-628-7978 erheaume@ea.com