Video game maker Electronic Arts’ fiscal second quarter 2020 earnings declined from the year-ago quarter, and also missed some analysts’ expectations. Revenue, however, increased year-over-year.
The company’s revenues climbed +4.8% from the prior-year quarter to $1.35 billion. While Product revenues (42.1% of total revenues) fell - 8.8%, Service and other revenues (57.9% of total revenues) surged +17.6%.
Adjusted earnings came in at 78 cents per share (which excluded tax benefits worth $2.11). The company had reported earnings of 83 cents per share in the year-ago quarter. The Zacks Consensus Estimate for earnings was 85 cents.
EA’s digital revenues (68.4% of total revenues) increased +18.2% year over year. Packaged goods and other segment revenues (31.6% of total revenues) declined -15.8%.
Digital net bookings were +24% higher from the year-ago quarter.
Gross margin in the quarter expanded +250 basis points on a year-over-year basis to 70%.
For the third quarter of fiscal 2020, EA expects GAAP revenues of $1.510 billion, and net bookings of $1.940 billion.
Looking farther ahead, the company projects fiscal full-year 2020 GAAP revenues to be $5.410 billion and net bookings to be $5.125 billion. It expects digital net revenues of $4.230 billion. Packaged goods & other net revenues are anticipated to be $1.180 billion.
Management continues to expect The Sims 4 and Apex Legends to deliver net bookings of $300-$400 million each.
EA has forecasted earnings to be $9.57 per share for the year, including $5.74 of income tax benefits.
For the rest of 2019, the company has two major titles slated for release - Need for Speed Heat, which is scheduled to release on Nov. 8, and Star Wars Jedi: Fallen Order, which is expected to come out on Nov. 15.
EA's Aroon Indicator triggered a bullish signal on July 26, 2024. Tickeron's A.I.dvisor detected that the AroonUp green line is above 70 while the AroonDown red line is below 30. When the up indicator moves above 70 and the down indicator remains below 30, it is a sign that the stock could be setting up for a bullish move. Traders may want to buy the stock or look to buy calls options. A.I.dvisor looked at 279 similar instances where the Aroon Indicator showed a similar pattern. In of the 279 cases, the stock moved higher in the days that followed. This puts the odds of a move higher at .
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
a publisher of game software content and services
Industry PackagedSoftware