TechPression

Tag: Electronic Arts

  • EA stock drops 7% on disappointing earnings forecast

    EA stock drops 7% on disappointing earnings forecast

    On January 22, 2025, Electronic Arts (EA) announced a downward revision in its fiscal year 2025 guidance, leading to a notable drop in its stock price. 

    EA forecasts net bookings of $2.215 billion in the fiscal third quarter, which ended December 31, down from $2.4 billion to $2.55 billion.

    According to a statement from the company, revenue for the December quarter will be around $1.88 billion, with diluted earnings per share of $1.11.

    For the fiscal year ending March 31, EA estimates net bookings of $7 billion to $7.15 billion, down from $7.5 billion to $7.8 billion. EA claims net bookings include online and physical game sales.

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    The role-playing game “Dragon Age,” available on consoles including the Sony PlayStation and Microsoft Xbox, had 1.5 million players during the quarter, the company reported, falling short of its goals by over 50 percent.

    “During Q3, we continued to deliver high-quality games and experiences across our portfolio,” EA CEO Andrew Wilson said. “Dragon Age and EA SPORTS FC 25 underperformed our net bookings expectations.”

    Disappointing performance of key titles

    The poor performance of EA Sports FC is particularly concerning, given that it is the successor to the highly successful FIFA series. 

    EA Sports launched the EA Sports FC series after ending its licensing agreement with FIFA in 2022, marking a significant shift in its football gaming strategy. 

    The first game in the series, EA Sports FC 24, was released in 2023, but it has yet to match the popularity of its predecessors. 

    As Andrew Wilson, CEO of Electronic Arts, noted during an investor call, “We started our FY25 strong. We beat our net bookings guidance, and we executed across our business as we entertained and connected hundreds of millions of people around the world”. 

    However, this optimism contrasts with the current market concerns about EA’s strategic direction and growth potential.

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    Market reaction and challenges ahead

    The market reaction to EA’s announcement was swift, with the stock becoming the biggest decliner in the S&P 500 on January 22, 2025. 

    The company’s live services segment, which had previously shown growth, is now expected to decline similarly. This shift reflects competitive pressures and EA’s limited success in diversifying beyond its sports gaming portfolio. 

    As EA prepares to announce its final fiscal third-quarter results on February 4, 2025, investors closely watch how the company will address these challenges. 

    Market experts are still unsure if EA will be able to return to growth in fiscal year 2026, even after these setbacks.

  • EA unveils all-in-one sports app

    EA unveils all-in-one sports app

    In continuation of the combination of real-life sports and games, Electronic Arts intends to launch a new tool called EA Sports software if the idea is successful.

    The software will encourage the participation of fans, and the individuals interested in the sports will have an engaging interaction. Indeed, it will be first available on iPhone and Android in Spain this autumn.

    Towards this end, Electronic Arts is broadening its scope beyond the console and the video game and hopes to change how fans engage with sports and related programs to reach new audiences.

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    Enhancing the potential of participation of fans through social relatedness 

    The EA Sports App has features created to enhance the class and ensure that the fans are still interested in the sports they like. Consumers can get current information, scores, and high aspects through the discovery feed from their favourite teams’ one-stop shopping.

    Importantly, for Electronic Arts, the live part aims to keep the audience’s attention before, during and after the live event. However, the current games’ sports fans’ discussion area creates the aspect of user interaction, hence creating a following as a result. There are many proofs of its uniqueness, so every sports fan should have the app on his device.

    Bringing gaming rewards to real-life sports

    Another striking feature of this Application is the in-game rewards in the EA Sports App. The audiences who engage with the app’s contents will likely benefit from the download, especially when they get items like Ultimate Team cards.

    As the points of interconnection between real-life interaction and gaming help eliminate the wall built between being just a fan on one side or a game on the other, it offers extra encouragement to sports lovers to participate in actual events. EA is using this app as a vehicle to integrate its gaming culture into the everyday lives of sports fans.

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    Besides, it will have features such as the ability to put the challengers in the application so users can meet them when competing. These were meant to enable one or more users to engage in a game, trivia, prediction, or some activity at a live event that was either co-occurring or in which the user was interested.

    Thus, Electronic Arts expects to engage its fans during a match to enhance the love story between video games and live.

    The app will concentrate on football and be created in collaboration with La Liga. On the other hand, Electronic Arts plans to expand its market gradually and add more sports in subsequent years, such as the National Football League and College football. This will align with the company’s broader objective of engaging with sports fans on a level other than game consoles.