Record Q4 net bookings driven by all-time high EA SPORTS FIFA franchise performance;

Company carries strong momentum into brand launch of EA SPORTS FC

Electronic Arts Inc. (NASDAQ: EA) today announced preliminary financial results for its fourth quarter and fiscal year ended March 31, 2023.

“EA delivered a strong Q4 with record net bookings, up 11 percent year-over-year, demonstrating the strength of our business. Our teams continue to create high quality entertainment, fueled by amazing games and deeply engaging live services,” said Andrew Wilson, CEO of Electronic Arts. “We're excited to continue our momentum, including the highly anticipated launch of EA SPORTS FC later this year.”

"Record live services performance and increased engagement, particularly from our EA SPORTS FIFA franchise, drove better-than-expected Q4 net bookings, capping a strong finish to the fiscal year," said Chris Suh, CFO. "Looking ahead, our teams remain disciplined in prioritizing the player experience as we continue to focus our investments on long-term growth."

Selected Operating Highlights and Metrics¹

• Net bookings² for Q4 was $1.946 billion, up 11% year-over-year (up 15% in constant currency).
• Live services and other net bookings for Q4 was $1.622 billion, a record for the quarter, up 9% year-over-year (up 13% in constant currency) and represented 83% of total net bookings.
• The EA SPORTS FIFA franchise Q4 net bookings grew 31% year-over-year (up 37% in constant currency).
• In the six months since launch, EA SPORTS FIFA 23 has surpassed life-time sales of EA SPORTS FIFA 22, becoming the most successful launch in franchise history.
• Apex Legends delivered net bookings growth in Q4 year-over-year at constant currency, driven by a successful Season 16 with peak weekly active users up over 20% from the previous season.
• Life-to-date, The Sims 4 player network has grown to more than 70 million worldwide.

Selected Financial Highlights and Metrics

• Net revenue was $1.874 billion for the quarter and $7.426 billion for the fiscal year.
• Net cash provided by operating activities was $617 million for the quarter and $1.550 billion for the fiscal year.
• EA repurchased 2.7 million shares for $325 million during the quarter, bringing the total for the fiscal year to 10.4 million shares for $1.295 billion.

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 21, 2023 to shareholders of record as of the close of business on May 31, 2023.

Quarterly Financial Highlights

The following GAAP-based financial data^3,4 and tax rate of 19% was used internally by company management to adjust its GAAP results in order to assess EA’s operating results:

Fiscal Year Financial Highlights

The following GAAP-based financial data^3,4 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.

Operating Metric

The following is a calculation of our total net bookings² for the periods presented:

Business Outlook as of May 9, 2023

Fiscal Year 2024 Expectations – Ending March 31, 2024

Financial metrics:

• Net revenue is expected to be approximately $7.300 billion to $7.700 billion.
  • No change in deferred net revenue (online-enabled games) is expected.
• Net income is expected to be approximately $915 million to $1.055 billion.
• Diluted earnings per share is expected to be approximately $3.30 to $3.81.
• Operating cash flow is expected to be approximately $1.700 billion to $1.850 billion.
• The Company estimates a share count of 277 million for purposes of calculating fiscal year 2024 diluted earnings per share.

Operational metric:

• Net bookings² is expected to be approximately $7.300 billion to $7.700 billion.

In addition, the following outlook for GAAP-based financial data^3,4 and long-term tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods:

First Quarter Fiscal Year 2024 Expectations – Ending June 30, 2023

Financial metrics:

• Net revenue is expected to be approximately $1.825 billion to $1.925 billion.
  • Change in deferred net revenue (online-enabled games) is expected to be approximately ($325) million.

• Net income is expected to be approximately $271 million to $316 million.
• Diluted earnings per share is expected to be approximately $0.98 to $1.14.
• The Company estimates a share count of 277 million for purposes of calculating first quarter fiscal 2024 diluted earnings per share.

Operational metric:

• Net bookings² is expected to be approximately $1.500 billion to $1.600 billion.

In addition, the following outlook for GAAP-based financial data^3,4 and long-term tax rate of 19% are used internally by EA to adjust GAAP expectations to assess EA’s operating results and plan for future periods:

Conference Call and Supporting Documents

Electronic Arts will host a conference call on May 9, 2023 at 2:00 pm PT (5:00 pm ET) to review its results for the fourth fiscal quarter and fiscal year ended March 31, 2023 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 24, 2023 at (800) 770-2030 (domestic) or (647) 362-9199 (international) using pin 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 9, 2023” 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 among competing platforms; 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, 2022.

These forward-looking statements are current as of May 9, 2023. 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, 2023. 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, 2023.

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 2023, EA posted GAAP net revenue of approximately $7.4 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™, Madden NFL, Need for Speed™, Titanfall™, Plants vs. Zombies™ and F1^®. More information about EA is available at www.ea.com/news.

EA SPORTS, Battlefield, Need for Speed, Apex Legends, The Sims, Titanfall and Plants vs. Zombies are trademarks of Electronic Arts Inc. STAR WARS © & TM 2015 Lucasfilm Ltd. All rights reserved. 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, 2022.

⁴ On March 29, 2023, EA announced a restructuring plan focused on prioritizing investments aligned with the Company's growth opportunities and optimizing its real estate portfolio.

Results (in $ millions, except per share data)

The following table reports the variance of the actuals versus our guidance provided on January 31, 2023 for the three months ended March 31, 2023 plus a comparison to the actuals for the three months ended March 31, 2022.