Electronic Arts profit climbs, shares soar

EA's 1st-quarter net income grows, stock climbs as results surpass analyst expectations

Associated Press

REDWOOD CITY, Calif. (AP) -- Video game publisher Electronic Arts Inc. posted a 10 percent increase in its fiscal first-quarter net income on Tuesday, helped by lower expenses and growing mobile and digital revenue in what's usually a slow season for the industry.

The results surpassed Wall Street's expectations, and EA's stock soared in extended trading after the results were announced.

The company behind popular game franchises such as "Madden," ''Need for Speed" and "Battlefield" earned $222 million, or 71 cents per share, in the April-June period. That's up from $201 million, or 63 cents per share, in the same period a year earlier.

Revenue slid less than 1 percent to $949 million from $955 million.

Excluding stock compensation costs and other expenses, the quarter's adjusted loss came to 40 cents per share, better than the adjusted loss of 60 cents per share that analysts polled by FactSet had expected.

Adjusted revenue, which accounts for deferred revenue and expenses from games with online components, was $495 million, up from $491 million and above Wall Street's expectations of $453.5 million.

"EA had a solid quarter driven by continued digital growth and disciplined cost management," said Executive Chairman Larry Probst in a statement. "We are also executing on a clear set of goals for leadership on mobile, PC, current and next generation consoles."

Digital revenue, which includes game downloads, grew during the quarter, though revenue from packaged games declined.

EA stuck to its full-year outlook for adjusted earnings of $1.20 billion and adjusted revenue of $4 billion. Analysts are expecting earnings of $1.21 per share on revenue of $4.02 billion. The year's biggest quarter will be the October-December period, when new game consoles from Sony and Microsoft are expected to go on sale.

Shares of Redwood City, Calif.-based EA rose $1.52, or 6.4 percent, to $25.35 in after-hours trading. The stock had closed down 18 cents at $23.83.

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