Electronic Arts Beats on Both Top and Bottom Lines
Electronic Arts (NAS: EA) reported earnings on May 7. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended March 31 (Q4), Electronic Arts beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share improved significantly.
Margins grew across the board.
Electronic Arts chalked up revenue of $977.0 million. The 20 analysts polled by S&P Capital IQ expected to see net sales of $959.2 million on the same basis. GAAP reported sales were 26% higher than the prior-year quarter's $1.09 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.17. The 20 earnings estimates compiled by S&P Capital IQ anticipated $0.16 per share. GAAP EPS of $1.20 for Q4 were 167% higher than the prior-year quarter's $0.45 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 72.7%, 280 basis points better than the prior-year quarter. Operating margin was 26.8%, 1,290 basis points better than the prior-year quarter. Net margin was 29.2%, 1,530 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $556.7 million. On the bottom line, the average EPS estimate is -$0.36.
Next year's average estimate for revenue is $4.48 billion. The average EPS estimate is $1.13.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,983 members out of 2,246 rating the stock outperform, and 263 members rating it underperform. Among 558 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 492 give Electronic Arts a green thumbs-up, and 66 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Electronic Arts is outperform, with an average price target of $23.55.
New technology paradigms and mobile devices are driving the next wave of computing. Many older companies won't survive the change, while fortunes will be made by the first movers in the field. Where does Electronic Arts fit in? What's the fortune-making change? Check out "The Two Words Bill Gates Doesn't Want You to Hear." Click here for instant access to this free report.
- Add Electronic Arts to My Watchlist.
At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.