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Electronic Arts beats Q1 earnings projections

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Yahoo Finance's Jared Blikre breaks down Electronic Arts' earnings which were relased after the bell on Tuesday.

Video Transcript

ADAM SHAPIRO: We are going to go to earnings because Jared's got Electronic Arts. And it's a beat, right?

JARED BLIKRE: It is. It's a beat on both the top and bottom lines. But the guidance was a little bit weak. That may be why the stock is off about 1 and 1/2% in afterhours trading. First, the numbers for the reporting quarter, the first quarter-- fourth quarter results-- excuse me-- that they just finished, adjusted revenue coming in at $1.49 billion. That's higher than the $1.4 billion that the Street was expecting.

Adjusted EPS coming in at $1.23, higher than the estimate of $1.06. And then another key metric is line services and other revenue. That came in at $1.1 billion, higher than the estimate of $968 million. Finally, full gain revenue, $250 million. The estimate was for slightly higher, $251.6 million, so slight miss right there.

But now on to the 2022 year forecast, they're seeing adjusted revenue of $7.3 billion. And that's higher, significantly higher, than the estimate of $6.6 billion. They're seeing adjusted EPS for the year coming in at $6.15, whereas the estimate was for $6.11, a little bit lower. That fourth quarter driven largely by their live services and also, of course, their game, "Apex Legends." They're seeing expansion of franchises to more platforms, more geographies, especially with the recent acquisitions, as catalysts for future growth.

And here's a quote from the COO and CFO in the earnings release. They're saying EA delivered a strong quarter, delivered-- driven by line services and "Apex Legend's" extraordinary performance. "Apex" steadily grew throughout the last year, driven by the games team and the content they are delivering. Well, let's take a look at the stock. It's now off about 2%, as you can see on your charts there.

And we're going to take a longer term look. Here's a one-year look at EA. Kind of sideways choppy action, still up 20% over the trailing year. Here's a slightly longer term look. Choppy there, too. It wasn't able to get through these 150 highs a couple of years ago. So that could be a stumbling point. Technically, it looks like it's a bullish, about to break out, but we could also move to the south side. Have to see what happens in early trading tomorrow and the close.