Thanks to sales of FIFA and mobile games, Electronic Arts beat its earnings expectations for the second fiscal quarter ended September 30.
EA reported GAAP (generally accepted accounting principles) earnings per share of 70 cents on revenue of $1.1 billion. The company benefited from continuing success of its Star Wars console and mobile titles, as well as the release of FIFA Mobile. Analysts had expected EA to report non-GAAP earnings per share of 43 cents a share on revenue of $1.09 billion.
“They beat [expectations] by a mile,” said Michael Pachter, analyst at Wedbush Securities, in an email to GamesBeat.
EA has a huge fiscal Q3 coming, with the October 21 release of Battlefield 1 and the October 28 release of Titanfall 2. But those titles will go up against stiff competition in the form of Call of Duty: Infinite Warfare. Still, it’s fair to say that EA has some big titles coming in the quarter that ends December 31.
“Q2 was an excellent quarter for Electronic Arts, led by breakthrough new EA Sports titles engaging players across console and mobile,” said EA CEO Andrew Wilson in a statement. “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.”
Despite the good quarter, EA stock at first fell 2.7 percent so far in after-hours trading to $75.75 a share, but it’s since rebounded to $80.48 a share up 3.4 percent. EA’s market value is $23.4 billion.
“Net sales in the quarter were better than expected driven by outperformance in FIFA, and supported by strong year-on-year growth in mobile,” said chief financial officer Blake Jorgensen in a statement. “We are raising our annual guidance today based on the strength of our holiday slate and FIFA 17’s strong performance to date.”
EA said that the Battlefield 1 total player base for its first week was nearly double that at the start of Battlefield 4, one of EA’s record-breaking games (though it didn’t provide a specific number).
In the first week of FIFA 17, 20 percent more players were engaged in the game compared to the first week of FIFA 16 last year and nearly two-thirds of all FIFA 17 players have engaged in “The Journey” story mode. Net sales from FIFA, Madden NFL and Hockey Ultimate Team are collectively up 15 percent for the trailing twelve months compared to last year.
And FIFA Mobile reached No. 1 on the App Store free games chart in 138 countries. Titanfall 2 has been rated 90 or above by more than 40 top outlets. Meanwhile, Star Wars: Galaxy of Heroes has generated nearly $100 million in revenue and 30 million downloads in 11 months, according to measurement firm Sensor Tower.
On a GAAP basis, quarterly net revenue was $898 million. Of the total net revenue 63 percent, or $566 million, was digital. GAAP-based diluted loss per share of 13 cents was above guidance of 17 cents.
Update, 2:22 p.m. Pacific: EA’s share price has rebounded and is up in after-hours trading. It was initially down.