[July 30, 2015] |
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Electronic Arts Reports Q1 FY16 Financial Results
Electronic Arts Inc. (NASDAQ: EA) today announced preliminary financial
results for its first fiscal quarter ended June 30, 2015.
"Q1 was a great start to fiscal year 2016 for Electronic Arts as we
continue our journey to put our players first and deliver amazing
entertainment experiences," said Chief Executive Officer Andrew Wilson.
"We have players engaging for longer periods in our live services,
ongoing strength across our digital business and growing anticipation
for our upcoming titles."
"EA delivered first quarter revenue, margins and EPS above guidance
through strength in catalog sales and outperformance in digital live
services offerings," said Chief Financial Officer Blake Jorgensen. "We
are raising our full-year guidance today to reflect the momentum across
our portfolio."
News and ongoing updates regarding EA and our games are available on
EA's blog at www.ea.com/news.
Selected Operating Highlights and Metrics:
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At E3, EA titles earned 132 awards including four of the 2015 E3 Game
Critic Awards: Star Wars™ Battlefront™ for Best Action Game and
Best Online Multiplayer, Need for Speed™ for Best Racing Game
and EA SPORTS™ FIFA 16 for Best Sports Game.
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Trailers, gameplay and livestreams of EA's games were viewed over 53
million times throughout the week of E3.
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Players in Battlefield 4™ and Battlefield™ Hardline
logged more than 170 million online gameplay hours combined in Q1.
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Monthly active users for EA's mobile titles averaged more than 150
million in Q1.
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More than 16 million matches of FIFA 15 were played on average per day
in Q1.
Selected Financial Highlights:
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For the quarter, non-GAAP net revenue of $693 million was above our
guidance of $640 million. Diluted non-GAAP EPS of $0.15 was above our
guidance of $0.00.
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EA increased fiscal 2016 non-GAAP net revenue guidance by $50 million
to $4.450 billion and diluted non-GAAP EPS guidance by $0.10 to $2.85
per share.
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Operating cash flow of $992 million was a record high for any trailing
twelve month Q1 period.
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EA repurchased 2.2 million shares in Q1 for $132 million.
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(in millions of $, except per share amounts)
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Quarter Ended 6/30/15
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Quarter Ended 6/30/14
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GAAP Digital Net Revenue
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$
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623
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$
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536
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GAAP Packaged Goods and Other Net Revenue
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580
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678
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GAAP Total Net Revenue
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$
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1,203
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$
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1,214
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Non-GAAP Digital Net Revenue
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$
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532
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$
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482
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Non-GAAP Packaged Goods and Other Net Revenue
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161
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293
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Non-GAAP Total Net Revenue
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$
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693
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$
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775
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GAAP Net Income
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$
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442
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$
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335
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Non-GAAP Net Income
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49
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61
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GAAP Diluted Earnings Per Share
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1.32
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1.04
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Non-GAAP Diluted Earnings Per Share
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0.15
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0.19
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Operating Cash Flow
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($71
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)
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$
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4
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TTM Financial Highlights:
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(in millions of $)
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TTM Ended
6/30/15
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TTM Ended
6/30/14
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GAAP Net Revenue
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$
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4,504
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$
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3,840
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GAAP Net Income
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982
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121
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Non-GAAP Net Revenue
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4,237
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4,301
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Non-GAAP Net Income
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794
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716
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Operating Cash Flow
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$
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992
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$
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964
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Business Outlook as of July 30, 2015
The following forward-looking statements, as well as those made above,
reflect expectations as of July 30, 2015. Electronic Arts assumes no
obligation to update these statements. Results may be materially
different and are affected by many factors detailed in this release and
in EA's annual and quarterly SEC filings.
Fiscal Year 2016 Expectations - Ending March 31, 2016
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GAAP net revenue is expected to be approximately $4.300 billion.
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Non-GAAP net revenue is expected to be approximately $4.450 billion.
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GAAP diluted earnings per share is expected to be approximately $1.98.
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Non-GAAP diluted earnings per share is expected to be approximately
$2.85.
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The Company estimates a share count of 339 million for purposes of
calculating fiscal year 2016 GAAP diluted earnings per share and 329
million for purposes of calculating fiscal year 2016 non-GAAP diluted
earnings per share. Non-GAAP shares used for computing diluted
earnings per share differs from GAAP due to the inclusion of the
anti-dilutive effect of the Convertible Bond Hedge.
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Expected non-GAAP net income excludes the impact of the following
items (estimate in millions) from expected GAAP net income:
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Acquisition-related expenses
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$
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56
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Amortization of debt discount
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25
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Change in deferred net revenue (online-enabled games)
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150
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Stock-based compensation
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180
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Income tax adjustments
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(145)
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Expected Impact on Non-GAAP Net Income (net)
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$
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266
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Second Quarter Fiscal Year 2016 Expectations - Ending September 30,
2015
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GAAP net revenue is expected to be approximately $815 million.
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Non-GAAP net revenue is expected to be approximately $1.075 billion.
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GAAP diluted loss per share is expected to be approximately $0.58.
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Non-GAAP diluted earnings per share is expected to be approximately
$0.40.
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The Company estimates a share count of 313 million for purposes of
calculating second quarter fiscal year 2016 GAAP diluted loss per
share, and 328 million for non-GAAP diluted earnings per share.
Non-GAAP shares used for computing diluted earnings per share includes
potentially dilutive equity instruments and the anti-dilutive effect
of the Convertible Bond Hedge.
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Expected non-GAAP net income excludes the impact of the following
items (estimate in millions) from expected GAAP net income:
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Acquisition-related expenses
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$
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14
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Amortization of debt discount
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10
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Change in deferred net revenue (online-enabled games)
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260
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Stock-based compensation
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45
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Income tax adjustments
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(17
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Expected Impact on Non-GAAP Net Income (net)
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$
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312
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Conference Call and Supporting Documents
Electronic Arts will host a conference call on July 30, 2015 at 2:00 pm
PT (5:00 pm ET) to review its results for the first quarter ended June
30, 2015 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: 888-469-0955
(domestic) or 312-470-7475 (international), using the password "EA" or
via webcast at http://ir.ea.com.
EA will also post a slide presentation that accompanies the call at http://ir.ea.com.
A dial-in replay of the conference call will be available until August
13, 2015 at 888-277-9387 (domestic) or 402-998-0511 (international). An
audio webcast replay of the conference call will be available for one
year at http://ir.ea.com.
Non-GAAP Financial Measures
To supplement the Company's unaudited condensed consolidated financial
statements presented in accordance with GAAP, Electronic Arts uses
certain non-GAAP measures of financial performance. The presentation of
these non-GAAP financial measures is not intended to be considered in
isolation from, as a substitute for, or superior to, the financial
information prepared and presented in accordance with GAAP, and may be
different from non-GAAP financial measures used by other companies. In
addition, these non-GAAP measures have limitations in that they do not
reflect all of the amounts associated with the Company's results of
operations as determined in accordance with GAAP. The non-GAAP financial
measures used by Electronic Arts include: non-GAAP net revenue, non-GAAP
gross profit, non-GAAP operating income (loss), non-GAAP net income
(loss), non-GAAP diluted earnings (loss) per share and non-GAAP diluted
shares. These non-GAAP financial measures exclude the following items
(other than Shares from Convertible Bond Hedge, which are included), as
applicable in a given reporting period, from the Company's unaudited
condensed consolidated statements of operations:
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Acquisition-related expenses
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Amortization of debt discount
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Change in deferred net revenue (online-enabled games)
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College football settlement expenses
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Income tax adjustments
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Loss on licensed intellectual property commitment (COGS)
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Restructuring and other
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Shares from Convertible Bond Hedge
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Stock-based compensation
Electronic Arts may consider whether other significant non-recurring
items that arise in the future should also be excluded in calculating
the non-GAAP financial measures it uses.
Electronic Arts believes that these non-GAAP financial measures, when
taken together with the corresponding GAAP financial measures, provide
meaningful supplemental information regarding the Company's performance
by excluding certain items that may not be indicative of the Company's
core business, operating results or future outlook. Electronic Arts'
management uses, and believes that investors benefit from referring to,
these non-GAAP financial measures in assessing the Company's operating
results both as a consolidated entity and at the business unit level, as
well as when planning, forecasting and analyzing future periods. The
Company's management team is evaluated on the basis of non-GAAP
financial measures and these measures also facilitate comparisons of the
Company's performance to prior periods.
In addition to the reasons stated above, which are generally applicable
to each of the items Electronic Arts excludes from its non-GAAP
financial measures, the Company believes it is appropriate to exclude
certain items for the following reasons:
Acquisition-Related Expenses. GAAP requires expenses to be
recognized for various types of events associated with a business
acquisition. These events include expensing acquired intangible assets,
including acquired in-process technology, post-closing adjustments
associated with changes in the estimated amount of contingent
consideration to be paid in an acquisition, and the impairment of
accounting goodwill created as a result of an acquisition when future
events indicate there has been a decline in its value. When analyzing
the operating performance of an acquired entity, Electronic Arts'
management focuses on the total return provided by the investment (i.e.,
operating profit generated from the acquired entity as compared to the
purchase price paid including the final amounts paid for contingent
consideration) without taking into consideration any allocations made
for accounting purposes. When analyzing the operating performance of an
acquisition in subsequent periods, the Company's management excludes the
GAAP impact of any adjustments to the fair value of these
acquisition-related balances to its financial results.
Amortization of Debt Discount on the Convertible Senior Notes.
Under GAAP, certain convertible debt instruments that may be settled in
cash on conversion are required to be separately accounted for as
liability (debt) and equity (conversion option) components of the
instrument in a manner that reflects the issuer's non-convertible debt
borrowing rate. Accordingly, for GAAP purposes, we are required to
amortize as a debt discount an amount equal to the fair value of the
conversion option as interest expense on the Company's $632.5 million of
0.75% convertible senior notes that were issued in a private placement
in July 2011 over the term of the notes. Electronic Arts' management
excludes the effect of this amortization in its non-GAAP financial
measures.
Change in Deferred Net Revenue (Online-enabled Games). The
majority of our software games can be connected to the Internet whereby
a consumer may be able to download unspecified content or updates on a
when-and-if-available basis ("unspecified updates") for use with the
original game software. In addition, we may also offer an online
matchmaking service that permits consumers to play against each other
via the Internet. GAAP requires us to account for the consumer's right
to receive unspecified updates or the matchmaking service for no
additional fee as a "bundled" sale, or multiple-element arrangement.
Electronic Arts is not able to objectively determine the fair value of
these unspecified updates or online service included in certain of its
online-enabled games. As a result, the Company recognizes the revenue
from the sale of these online-enabled games on a straight-line basis
over the estimated offering period. Electronic Arts' management excludes
the impact of the change in deferred net revenue related to
online-enabled games in its non-GAAP financial measures for the reasons
stated above and also to facilitate an understanding of our operations
because all related costs of revenue are expensed as incurred instead of
deferred and recognized ratably.
College Football Settlement Expenses. During fiscal 2014,
Electronic Arts recognized a $48 million charge for expected litigation
settlement and license expenses related to our college football
business. This expense is excluded from our non-GAAP financial measures.
Income Tax Adjustments. The Company uses a fixed, long-term
projected tax rate internally to evaluate its operating performance, to
forecast, plan and analyze future periods, and to assess the performance
of its management team. Accordingly, the Company applies the same tax
rate to its non-GAAP financial results. During fiscal year 2016 the
Company is applying a tax rate of 22 percent to its non-GAAP financial
results. For fiscal years 2014 and 2015, a 25 percent tax rate was
applied, and through fiscal year 2013 the Company applied a 28 percent
tax rate.
Loss on Licensed Intellectual Property Commitment (COGS). During
the first quarter of fiscal 2015, Electronic Arts terminated its right
to utilize certain intellectual property that the Company had previously
licensed and we incurred a loss of $122 million on the corresponding
license commitment. This expense is excluded from our non-GAAP financial
measures.
Restructuring and Other. Although Electronic Arts has engaged in
various restructuring activities in the past, each has been a discrete
event based on a unique set of business objectives. Each of these
restructurings has been unlike its predecessors in terms of its
operational implementation, business impact and scope. As such, the
Company believes it is appropriate to exclude restructuring charges from
its non-GAAP financial measures.
Shares from Convertible Bond Hedge. In July 2011, the Company
issued convertible senior notes that mature in July 2016 (the "Notes")
with an initial conversion price of approximately $31.74 per share. When
the quarterly average trading price of EA's common stock is above $31.74
per share, the potential conversion of the Notes has a dilutive impact
on the Company's earnings per share. At the time the Notes were issued,
the Company entered into convertible note hedge transactions (the
"Convertible Bond Hedge") to offset the dilutive effect of the Notes.
The Company includes the anti-dilutive effect of the Convertible Bond
Hedge in determining its non-GAAP dilutive shares.
Stock-Based Compensation. When evaluating the performance of its
individual business units, the Company does not consider stock-based
compensation charges. Likewise, the Company's management teams exclude
stock-based compensation expense from their short and long-term
operating plans. In contrast, the Company's management teams are held
accountable for cash-based compensation and such amounts are included in
their operating plans. Further, when considering the impact of equity
award grants, Electronic Arts places a greater emphasis on overall
shareholder dilution rather than the accounting charges associated with
such grants.
In the financial tables below, Electronic Arts has provided a
reconciliation of the most comparable GAAP financial measures to
non-GAAP financial measures used in this press release.
Forward-Looking Statements
Some statements set forth in this release, including the information
relating to EA's fiscal 2016 guidance information under the heading
"Business Outlook," contain forward-looking statements that are subject
to change. Statements including words such as "anticipate," "believe,"
"estimate" or "expect" and statements in the future tense are
forward-looking statements. These forward-looking statements are
preliminary estimates and expectations based on current information and
are subject to business and economic risks and uncertainties that could
cause actual events or actual future results to differ materially from
the expectations set forth 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 titles; the Company's ability to manage expenses; the
competition in the interactive entertainment industry; the effectiveness
of the Company's sales and marketing programs; timely development and
release of Electronic Arts' products; the Company's ability to realize
the anticipated benefits of 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 service and support digital product
offerings, including managing online security; general economic
conditions; and other factors described in the Company's Annual Report
on Form 10-K for the fiscal year ended March 31, 2015.
These forward-looking statements are current as of July 30, 2015.
Electronic Arts assumes no obligation and does not intend to update
these forward-looking statements. 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 Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 2015. Electronic Arts assumes no obligation and does not
intend to update these estimates prior to filing its Form 10-Q for the
fiscal quarter ended June 30, 2015.
About Electronic Arts
Electronic Arts (NASDAQ: EA) is a global leader in digital interactive
entertainment. The Company delivers games, content and online services
for Internet-connected consoles, personal computers, mobile phones and
tablets. EA has more than 300 million registered players around the
world.
In fiscal year 2015, EA posted GAAP net revenue of $4.5 billion.
Headquartered in Redwood City, California, EA is recognized for a
portfolio of critically acclaimed, high-quality blockbuster brands such
as The Sims™, Madden NFL, EA SPORTS™ FIFA, Battlefield™, Dragon Age™ and
Plants vs. Zombies™. More information about EA is available at www.ea.com/news.
EA SPORTS, Battlefield 4, Battlefield, The Sims, Dragon Age, Need for
Speed and Plants vs. Zombies are trademarks of Electronic Arts Inc. and
its subsidiaries. STAR WARS © & TM 2015 Lucasfilm Ltd. John
Madden, NFL, and FIFA are the property of their respective owners and
used with permission. For additional information, please contact:
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ELECTRONIC ARTS INC. AND SUBSIDIARIES
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Unaudited Condensed Consolidated Statement of Operations
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(in millions, except share per data)
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Three Months Ended June 30,
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2015
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2014
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Net revenue
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Product
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$
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743
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$
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757
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Service and other
|
|
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|
|
460
|
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|
|
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|
|
457
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Total net revenue
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|
|
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1,203
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|
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1,214
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Cost of revenue
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Product
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94
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252
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Service and other
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79
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115
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Total cost of revenue
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173
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367
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Gross profit
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1,030
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847
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Operating expenses:
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Research and development
|
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296
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265
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Marketing and sales
|
|
|
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|
|
123
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|
|
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|
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|
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130
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General and administrative
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|
|
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|
|
98
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88
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Acquisition-related contingent consideration
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-
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(1
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Amortization of intangibles
|
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|
|
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1
|
|
|
|
|
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|
|
3
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Total operating expenses
|
|
|
|
|
|
|
518
|
|
|
|
|
|
|
|
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485
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Operating income
|
|
|
|
|
|
|
512
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|
|
|
|
|
|
362
|
|
Interest and other income (expense), net
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
(8
|
)
|
Income before provision for income taxes
|
|
|
|
|
|
|
509
|
|
|
|
|
|
|
|
|
354
|
|
Provision for income taxes
|
|
|
|
|
|
|
67
|
|
|
|
|
|
|
|
|
19
|
|
Net income
|
|
|
|
|
|
|
$
|
442
|
|
|
|
|
|
|
|
|
$
|
335
|
|
Earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
$
|
1.42
|
|
|
|
|
|
|
|
|
$
|
1.07
|
|
Diluted
|
|
|
|
|
|
|
$
|
1.32
|
|
|
|
|
|
|
|
|
$
|
1.04
|
|
Number of shares used in computation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
311
|
|
|
|
|
|
|
|
|
313
|
|
Diluted
|
|
|
|
|
|
|
335
|
|
|
|
|
|
|
|
|
322
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Results (in millions, except per share data)
The following tables reconcile the Company's net revenue, gross profit,
operating income, net income and number of diluted shares as presented
in its Unaudited Condensed Consolidated Statements of Operations and
prepared in accordance with Generally Accepted Accounting Principles
("GAAP") to its non-GAAP net revenue, non-GAAP gross profit, non-GAAP
operating income, non-GAAP net income, and number of non-GAAP diluted
shares.
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
2014
|
Net revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net revenue
|
|
|
|
|
|
|
$
|
1,203
|
|
|
|
|
|
$
|
1,214
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
(510
|
)
|
|
|
|
|
(439
|
)
|
Non-GAAP net revenue
|
|
|
|
|
|
|
$
|
693
|
|
|
|
|
|
$
|
775
|
|
Gross profit
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross profit
|
|
|
|
|
|
|
$
|
1,030
|
|
|
|
|
|
$
|
847
|
|
Acquisition-related expenses
|
|
|
|
|
|
|
12
|
|
|
|
|
|
14
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
(510
|
)
|
|
|
|
|
(439
|
)
|
Loss on licensed intellectual property commitment (COGS)
|
|
|
|
|
|
|
-
|
|
|
|
|
|
122
|
|
Non-GAAP gross profit
|
|
|
|
|
|
|
$
|
532
|
|
|
|
|
|
$
|
544
|
|
Operating income
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating income
|
|
|
|
|
|
|
$
|
512
|
|
|
|
|
|
$
|
362
|
|
Acquisition-related expenses
|
|
|
|
|
|
|
13
|
|
|
|
|
|
16
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
(510
|
)
|
|
|
|
|
(439
|
)
|
Loss on licensed intellectual property commitment (COGS)
|
|
|
|
|
|
|
-
|
|
|
|
|
|
122
|
|
College football settlement expenses
|
|
|
|
|
|
|
-
|
|
|
|
|
|
(5
|
)
|
Stock-based compensation
|
|
|
|
|
|
|
45
|
|
|
|
|
|
29
|
|
Non-GAAP operating income
|
|
|
|
|
|
|
$
|
60
|
|
|
|
|
|
$
|
85
|
|
Net Income
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
|
|
|
|
|
|
|
$
|
442
|
|
|
|
|
|
$
|
335
|
|
Acquisition-related expenses
|
|
|
|
|
|
|
13
|
|
|
|
|
|
16
|
|
Amortization of debt discount
|
|
|
|
|
|
|
6
|
|
|
|
|
|
5
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
(510
|
)
|
|
|
|
|
(439
|
)
|
Loss on licensed intellectual property commitment (COGS)
|
|
|
|
|
|
|
-
|
|
|
|
|
|
122
|
|
College football settlement expenses
|
|
|
|
|
|
|
-
|
|
|
|
|
|
(5
|
)
|
Stock-based compensation
|
|
|
|
|
|
|
45
|
|
|
|
|
|
29
|
|
Income tax adjustments
|
|
|
|
|
|
|
53
|
|
|
|
|
|
(2
|
)
|
Non-GAAP net income
|
|
|
|
|
|
|
$
|
49
|
|
|
|
|
|
$
|
61
|
|
Non-GAAP earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
$
|
0.16
|
|
|
|
|
|
$
|
0.19
|
|
Diluted
|
|
|
|
|
|
|
$
|
0.15
|
|
|
|
|
|
$
|
0.19
|
|
Number of shares
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP & Non-GAAP Basic
|
|
|
|
|
|
|
311
|
|
|
|
|
|
313
|
|
GAAP Diluted
|
|
|
|
|
|
|
335
|
|
|
|
|
|
322
|
|
Shares from convertible bond hedge
|
|
|
|
|
|
|
(10
|
)
|
|
|
|
|
(1
|
)
|
Non-GAAP Diluted
|
|
|
|
|
|
|
325
|
|
|
|
|
|
321
|
|
|
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES
|
Unaudited Condensed Consolidated Balance Sheets
|
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2015
|
|
|
|
|
March 31, 2015 1
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
$
|
1,810
|
|
|
|
|
|
$
|
2,068
|
Short-term investments
|
|
|
|
|
|
|
1,069
|
|
|
|
|
|
953
|
Receivables, net of allowances of $134 and $140, respectively
|
|
|
|
|
|
|
144
|
|
|
|
|
|
362
|
Inventories
|
|
|
|
|
|
|
34
|
|
|
|
|
|
36
|
Deferred income taxes, net
|
|
|
|
|
|
|
53
|
|
|
|
|
|
54
|
Other current assets
|
|
|
|
|
|
|
216
|
|
|
|
|
|
247
|
Total current assets
|
|
|
|
|
|
|
3,326
|
|
|
|
|
|
3,720
|
Property and equipment, net
|
|
|
|
|
|
|
444
|
|
|
|
|
|
459
|
Goodwill
|
|
|
|
|
|
|
1,713
|
|
|
|
|
|
1,713
|
Acquisition-related intangibles, net
|
|
|
|
|
|
|
98
|
|
|
|
|
|
111
|
Deferred income taxes, net
|
|
|
|
|
|
|
14
|
|
|
|
|
|
13
|
Other assets
|
|
|
|
|
|
|
126
|
|
|
|
|
|
131
|
TOTAL ASSETS
|
|
|
|
|
|
|
$
|
5,721
|
|
|
|
|
|
$
|
6,147
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
|
|
|
|
$
|
43
|
|
|
|
|
|
$
|
68
|
Accrued and other current liabilities
|
|
|
|
|
|
|
603
|
|
|
|
|
|
794
|
Deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
775
|
|
|
|
|
|
1,283
|
0.75% convertible senior notes due 2016, net
|
|
|
|
|
|
|
608
|
|
|
|
|
|
602
|
Total current liabilities
|
|
|
|
|
|
|
2,029
|
|
|
|
|
|
2,747
|
Income tax obligations
|
|
|
|
|
|
|
71
|
|
|
|
|
|
70
|
Deferred income taxes, net
|
|
|
|
|
|
|
80
|
|
|
|
|
|
80
|
Other liabilities
|
|
|
|
|
|
|
180
|
|
|
|
|
|
183
|
Total liabilities
|
|
|
|
|
|
|
2,360
|
|
|
|
|
|
3,080
|
0.75% convertible senior notes due 2016, net
|
|
|
|
|
|
|
25
|
|
|
|
|
|
31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
|
|
|
|
3
|
|
|
|
|
|
3
|
Paid-in capital
|
|
|
|
|
|
|
2,001
|
|
|
|
|
|
2,127
|
Retained earnings
|
|
|
|
|
|
|
1,346
|
|
|
|
|
|
904
|
Accumulated other comprehensive income (loss)
|
|
|
|
|
|
|
(14
|
)
|
|
|
|
|
2
|
Total stockholders' equity
|
|
|
|
|
|
|
3,336
|
|
|
|
|
|
3,036
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
$
|
5,721
|
|
|
|
|
|
$
|
6,147
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Derived from audited consolidated financial
statements.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES
|
Unaudited Condensed Consolidated Statements of Cash Flows
|
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2015
|
|
|
|
|
|
|
|
2015
|
|
|
|
|
|
2014
|
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
|
|
|
$
|
442
|
|
|
|
|
|
|
$
|
335
|
|
Adjustments to reconcile net income to net cash provided by (used
in) operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation, amortization and accretion
|
|
|
|
|
|
|
49
|
|
|
|
|
|
|
56
|
|
Stock-based compensation
|
|
|
|
|
|
|
45
|
|
|
|
|
|
|
29
|
|
Acquisition-related contingent consideration
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
(1
|
)
|
Change in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Receivables, net
|
|
|
|
|
|
|
219
|
|
|
|
|
|
|
110
|
|
Inventories
|
|
|
|
|
|
|
3
|
|
|
|
|
|
|
19
|
|
Other assets
|
|
|
|
|
|
|
26
|
|
|
|
|
|
|
21
|
|
Accounts payable
|
|
|
|
|
|
|
(16
|
)
|
|
|
|
|
|
(43
|
)
|
Accrued and other liabilities
|
|
|
|
|
|
|
(331
|
)
|
|
|
|
|
|
(84
|
)
|
Deferred income taxes, net
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
1
|
|
Deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
(508
|
)
|
|
|
|
|
|
(439
|
)
|
Net cash provided by (used in) operating activities
|
|
|
|
|
|
|
(71
|
)
|
|
|
|
|
|
4
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
|
|
|
|
(24
|
)
|
|
|
|
|
|
(27
|
)
|
Proceeds from maturities and sales of short-term investments
|
|
|
|
|
|
|
249
|
|
|
|
|
|
|
155
|
|
Purchase of short-term investments
|
|
|
|
|
|
|
(365
|
)
|
|
|
|
|
|
(335
|
)
|
Net cash used in investing activities
|
|
|
|
|
|
|
(140
|
)
|
|
|
|
|
|
(207
|
)
|
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock
|
|
|
|
|
|
|
45
|
|
|
|
|
|
|
5
|
|
Excess tax benefit from stock-based compensation
|
|
|
|
|
|
|
40
|
|
|
|
|
|
|
12
|
|
Repurchase and retirement of common stock
|
|
|
|
|
|
|
(132
|
)
|
|
|
|
|
|
(50
|
)
|
Net cash used in financing activities
|
|
|
|
|
|
|
(47
|
)
|
|
|
|
|
|
(33
|
)
|
Effect of foreign exchange on cash and cash equivalents
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
8
|
|
Decrease in cash and cash equivalents
|
|
|
|
|
|
|
(258
|
)
|
|
|
|
|
|
(228
|
)
|
Beginning cash and cash equivalents
|
|
|
|
|
|
|
2,068
|
|
|
|
|
|
|
1,782
|
|
Ending cash and cash equivalents
|
|
|
|
|
|
|
$
|
1,810
|
|
|
|
|
|
|
$
|
1,554
|
|
|
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES
|
Unaudited Supplemental Financial Information and Business Metrics
|
(in millions, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1
|
|
|
Q2
|
|
|
Q3
|
|
|
Q4
|
|
|
Q1
|
|
|
YOY %
|
|
|
|
|
|
|
|
|
FY15
|
|
|
FY15
|
|
|
FY15
|
|
|
FY15
|
|
|
FY16
|
|
|
Change
|
QUARTERLY RECONCILIATION OF RESULTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net revenue
|
|
|
|
|
|
|
|
1,214
|
|
|
|
990
|
|
|
|
1,126
|
|
|
|
1,185
|
|
|
|
1,203
|
|
|
|
(1
|
%)
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
|
(439
|
)
|
|
|
230
|
|
|
|
302
|
|
|
|
(289
|
)
|
|
|
(510
|
)
|
|
|
|
Non-GAAP net revenue
|
|
|
|
|
|
|
|
775
|
|
|
|
1,220
|
|
|
|
1,428
|
|
|
|
896
|
|
|
|
693
|
|
|
|
(11
|
%)
|
Gross profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross profit
|
|
|
|
|
|
|
|
847
|
|
|
|
563
|
|
|
|
725
|
|
|
|
951
|
|
|
|
1,030
|
|
|
|
22
|
%
|
Acquisition-related expenses
|
|
|
|
|
|
|
|
14
|
|
|
|
12
|
|
|
|
12
|
|
|
|
14
|
|
|
|
12
|
|
|
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
|
(439
|
)
|
|
|
230
|
|
|
|
302
|
|
|
|
(289
|
)
|
|
|
(510
|
)
|
|
|
|
Loss on licensed intellectual property commitment (COGS)
|
|
|
|
|
|
|
|
122
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
Stock-based compensation
|
|
|
|
|
|
|
|
-
|
|
|
|
1
|
|
|
|
1
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
Non-GAAP gross profit
|
|
|
|
|
|
|
|
544
|
|
|
|
806
|
|
|
|
1,040
|
|
|
|
676
|
|
|
|
532
|
|
|
|
(2
|
%)
|
GAAP gross profit % (as a % of GAAP net revenue)
|
|
|
|
|
|
|
|
70
|
%
|
|
|
57
|
%
|
|
|
64
|
%
|
|
|
80
|
%
|
|
|
86
|
%
|
|
|
|
Non-GAAP gross profit % (as a % of non-GAAP net revenue)
|
|
|
|
|
|
|
|
70
|
%
|
|
|
66
|
%
|
|
|
73
|
%
|
|
|
75
|
%
|
|
|
77
|
%
|
|
|
|
Operating income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating income
|
|
|
|
|
|
|
|
362
|
|
|
|
24
|
|
|
|
162
|
|
|
|
400
|
|
|
|
512
|
|
|
|
41
|
%
|
Acquisition-related expenses
|
|
|
|
|
|
|
|
16
|
|
|
|
15
|
|
|
|
16
|
|
|
|
16
|
|
|
|
13
|
|
|
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
|
(439
|
)
|
|
|
230
|
|
|
|
302
|
|
|
|
(289
|
)
|
|
|
(510
|
)
|
|
|
|
Loss on licensed intellectual property commitment (COGS)
|
|
|
|
|
|
|
|
122
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
College football settlement expenses
|
|
|
|
|
|
|
|
(5
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
Stock-based compensation
|
|
|
|
|
|
|
|
29
|
|
|
|
40
|
|
|
|
39
|
|
|
|
36
|
|
|
|
45
|
|
|
|
|
Non-GAAP operating income
|
|
|
|
|
|
|
|
85
|
|
|
|
309
|
|
|
|
519
|
|
|
|
163
|
|
|
|
60
|
|
|
|
(29
|
%)
|
GAAP operating income % (as a % of GAAP net revenue)
|
|
|
|
|
|
|
|
30
|
%
|
|
|
2
|
%
|
|
|
14
|
%
|
|
|
34
|
%
|
|
|
43
|
%
|
|
|
|
Non-GAAP operating income % (as a % of non-GAAP net revenue)
|
|
|
|
|
|
|
|
11
|
%
|
|
|
25
|
%
|
|
|
36
|
%
|
|
|
18
|
%
|
|
|
9
|
%
|
|
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
|
|
|
|
|
|
|
|
335
|
|
|
|
3
|
|
|
|
142
|
|
|
|
395
|
|
|
|
442
|
|
|
|
32
|
%
|
Acquisition-related expenses
|
|
|
|
|
|
|
|
16
|
|
|
|
15
|
|
|
|
16
|
|
|
|
16
|
|
|
|
13
|
|
|
|
|
Amortization of debt discount
|
|
|
|
|
|
|
|
5
|
|
|
|
6
|
|
|
|
5
|
|
|
|
6
|
|
|
|
6
|
|
|
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
|
(439
|
)
|
|
|
230
|
|
|
|
302
|
|
|
|
(289
|
)
|
|
|
(510
|
)
|
|
|
|
Loss on licensed intellectual property commitment (COGS)
|
|
|
|
|
|
|
|
122
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
College football settlement expenses
|
|
|
|
|
|
|
|
(5
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
Stock-based compensation
|
|
|
|
|
|
|
|
29
|
|
|
|
40
|
|
|
|
39
|
|
|
|
36
|
|
|
|
45
|
|
|
|
|
Income tax adjustments
|
|
|
|
|
|
|
|
(2
|
)
|
|
|
(62
|
)
|
|
|
(116
|
)
|
|
|
(39
|
)
|
|
|
53
|
|
|
|
|
Non-GAAP net income
|
|
|
|
|
|
|
|
61
|
|
|
|
232
|
|
|
|
388
|
|
|
|
125
|
|
|
|
49
|
|
|
|
(20
|
%)
|
GAAP net income % (as a % of GAAP net revenue)
|
|
|
|
|
|
|
|
28
|
%
|
|
|
-
|
|
|
|
13
|
%
|
|
|
33
|
%
|
|
|
37
|
%
|
|
|
|
Non-GAAP net income % (as a % of non-GAAP net revenue)
|
|
|
|
|
|
|
|
8
|
%
|
|
|
19
|
%
|
|
|
27
|
%
|
|
|
14
|
%
|
|
|
7
|
%
|
|
|
|
Diluted earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP earnings per share
|
|
|
|
|
|
|
|
1.04
|
|
|
|
0.01
|
|
|
|
0.44
|
|
|
|
1.19
|
|
|
|
1.32
|
|
|
|
27
|
%
|
Non-GAAP earnings per share
|
|
|
|
|
|
|
|
0.19
|
|
|
|
0.73
|
|
|
|
1.22
|
|
|
|
0.39
|
|
|
|
0.15
|
|
|
|
(21
|
%)
|
Number of diluted shares used in computation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
|
|
|
|
|
|
|
|
322
|
|
|
|
322
|
|
|
|
323
|
|
|
|
332
|
|
|
|
335
|
|
|
|
|
Non-GAAP
|
|
|
|
|
|
|
|
321
|
|
|
|
319
|
|
|
|
319
|
|
|
|
324
|
|
|
|
325
|
|
|
|
|
|
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES
|
Unaudited Supplemental Financial Information and Business Metrics
|
(in millions, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1
|
|
|
|
Q2
|
|
|
|
Q3
|
|
|
|
Q4
|
|
|
|
Q1
|
|
|
|
YOY %
|
|
|
|
|
|
|
|
|
FY15
|
|
|
|
FY15
|
|
|
|
FY15
|
|
|
|
FY15
|
|
|
|
FY16
|
|
|
|
Change
|
QUARTERLY NET REVENUE PRESENTATIONS - GAAP AND NON-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Geography net revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
|
|
|
|
|
522
|
|
|
|
|
433
|
|
|
|
|
473
|
|
|
|
|
528
|
|
|
|
|
506
|
|
|
|
|
(3
|
%)
|
International
|
|
|
|
|
|
|
|
692
|
|
|
|
|
557
|
|
|
|
|
653
|
|
|
|
|
657
|
|
|
|
|
697
|
|
|
|
|
1
|
%
|
Total GAAP net revenue
|
|
|
|
|
|
|
|
1,214
|
|
|
|
|
990
|
|
|
|
|
1,126
|
|
|
|
|
1,185
|
|
|
|
|
1,203
|
|
|
|
|
(1
|
%)
|
North America
|
|
|
|
|
|
|
|
(201
|
)
|
|
|
|
51
|
|
|
|
|
152
|
|
|
|
|
(125
|
)
|
|
|
|
(215
|
)
|
|
|
|
|
International
|
|
|
|
|
|
|
|
(238
|
)
|
|
|
|
179
|
|
|
|
|
150
|
|
|
|
|
(164
|
)
|
|
|
|
(295
|
)
|
|
|
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
|
(439
|
)
|
|
|
|
230
|
|
|
|
|
302
|
|
|
|
|
(289
|
)
|
|
|
|
(510
|
)
|
|
|
|
|
North America
|
|
|
|
|
|
|
|
321
|
|
|
|
|
484
|
|
|
|
|
625
|
|
|
|
|
403
|
|
|
|
|
291
|
|
|
|
|
(9
|
%)
|
International
|
|
|
|
|
|
|
|
454
|
|
|
|
|
736
|
|
|
|
|
803
|
|
|
|
|
493
|
|
|
|
|
402
|
|
|
|
|
(11
|
%)
|
Total Non-GAAP net revenue
|
|
|
|
|
|
|
|
775
|
|
|
|
|
1,220
|
|
|
|
|
1,428
|
|
|
|
|
896
|
|
|
|
|
693
|
|
|
|
|
(11
|
%)
|
North America
|
|
|
|
|
|
|
|
43
|
%
|
|
|
|
44
|
%
|
|
|
|
42
|
%
|
|
|
|
45
|
%
|
|
|
|
42
|
%
|
|
|
|
|
International
|
|
|
|
|
|
|
|
57
|
%
|
|
|
|
56
|
%
|
|
|
|
58
|
%
|
|
|
|
55
|
%
|
|
|
|
58
|
%
|
|
|
|
|
Total GAAP net revenue %
|
|
|
|
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
|
North America
|
|
|
|
|
|
|
|
41
|
%
|
|
|
|
40
|
%
|
|
|
|
44
|
%
|
|
|
|
45
|
%
|
|
|
|
42
|
%
|
|
|
|
|
International
|
|
|
|
|
|
|
|
59
|
%
|
|
|
|
60
|
%
|
|
|
|
56
|
%
|
|
|
|
55
|
%
|
|
|
|
58
|
%
|
|
|
|
|
Total Non-GAAP net revenue %
|
|
|
|
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue composition
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Packaged goods and other
|
|
|
|
|
|
|
|
678
|
|
|
|
|
482
|
|
|
|
|
585
|
|
|
|
|
571
|
|
|
|
|
580
|
|
|
|
|
(14
|
%)
|
Full game downloads
|
|
|
|
|
|
|
|
107
|
|
|
|
|
83
|
|
|
|
|
108
|
|
|
|
|
122
|
|
|
|
|
119
|
|
|
|
|
|
Extra content
|
|
|
|
|
|
|
|
225
|
|
|
|
|
212
|
|
|
|
|
210
|
|
|
|
|
265
|
|
|
|
|
291
|
|
|
|
|
|
Subscriptions, advertising and other
|
|
|
|
|
|
|
|
81
|
|
|
|
|
91
|
|
|
|
|
102
|
|
|
|
|
92
|
|
|
|
|
71
|
|
|
|
|
|
Mobile
|
|
|
|
|
|
|
|
123
|
|
|
|
|
122
|
|
|
|
|
121
|
|
|
|
|
135
|
|
|
|
|
142
|
|
|
|
|
|
Total Digital
|
|
|
|
|
|
|
|
536
|
|
|
|
|
508
|
|
|
|
|
541
|
|
|
|
|
614
|
|
|
|
|
623
|
|
|
|
|
16
|
%
|
Total GAAP net revenue
|
|
|
|
|
|
|
|
1,214
|
|
|
|
|
990
|
|
|
|
|
1,126
|
|
|
|
|
1,185
|
|
|
|
|
1,203
|
|
|
|
|
(1
|
%)
|
Packaged goods and other
|
|
|
|
|
|
|
|
(385
|
)
|
|
|
|
285
|
|
|
|
|
150
|
|
|
|
|
(277
|
)
|
|
|
|
(419
|
)
|
|
|
|
|
Full game downloads
|
|
|
|
|
|
|
|
(36
|
)
|
|
|
|
11
|
|
|
|
|
32
|
|
|
|
|
(8
|
)
|
|
|
|
(35
|
)
|
|
|
|
|
Extra content
|
|
|
|
|
|
|
|
(14
|
)
|
|
|
|
(59
|
)
|
|
|
|
104
|
|
|
|
|
(18
|
)
|
|
|
|
(36
|
)
|
|
|
|
|
Subscriptions, advertising and other
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
|
-
|
|
|
|
|
(2
|
)
|
|
|
|
(1
|
)
|
|
|
|
-
|
|
|
|
|
|
Mobile
|
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
(7
|
)
|
|
|
|
18
|
|
|
|
|
15
|
|
|
|
|
(20
|
)
|
|
|
|
|
Total Digital
|
|
|
|
|
|
|
|
(54
|
)
|
|
|
|
(55
|
)
|
|
|
|
152
|
|
|
|
|
(12
|
)
|
|
|
|
(91
|
)
|
|
|
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
|
(439
|
)
|
|
|
|
230
|
|
|
|
|
302
|
|
|
|
|
(289
|
)
|
|
|
|
(510
|
)
|
|
|
|
|
Packaged goods and other
|
|
|
|
|
|
|
|
293
|
|
|
|
|
767
|
|
|
|
|
735
|
|
|
|
|
294
|
|
|
|
|
161
|
|
|
|
|
(45
|
%)
|
Full game downloads
|
|
|
|
|
|
|
|
71
|
|
|
|
|
94
|
|
|
|
|
140
|
|
|
|
|
114
|
|
|
|
|
84
|
|
|
|
|
|
Extra content
|
|
|
|
|
|
|
|
211
|
|
|
|
|
153
|
|
|
|
|
314
|
|
|
|
|
247
|
|
|
|
|
255
|
|
|
|
|
|
Subscriptions, advertising and other
|
|
|
|
|
|
|
|
80
|
|
|
|
|
91
|
|
|
|
|
100
|
|
|
|
|
91
|
|
|
|
|
71
|
|
|
|
|
|
Mobile
|
|
|
|
|
|
|
|
120
|
|
|
|
|
115
|
|
|
|
|
139
|
|
|
|
|
150
|
|
|
|
|
122
|
|
|
|
|
|
Total Digital
|
|
|
|
|
|
|
|
482
|
|
|
|
|
453
|
|
|
|
|
693
|
|
|
|
|
602
|
|
|
|
|
532
|
|
|
|
|
10
|
%
|
Total Non-GAAP net revenue
|
|
|
|
|
|
|
|
775
|
|
|
|
|
1,220
|
|
|
|
|
1,428
|
|
|
|
|
896
|
|
|
|
|
693
|
|
|
|
|
(11
|
%)
|
Packaged goods and other
|
|
|
|
|
|
|
|
56
|
%
|
|
|
|
49
|
%
|
|
|
|
52
|
%
|
|
|
|
48
|
%
|
|
|
|
48
|
%
|
|
|
|
|
Full game downloads
|
|
|
|
|
|
|
|
9
|
%
|
|
|
|
8
|
%
|
|
|
|
9
|
%
|
|
|
|
10
|
%
|
|
|
|
10
|
%
|
|
|
|
|
Extra content
|
|
|
|
|
|
|
|
19
|
%
|
|
|
|
21
|
%
|
|
|
|
19
|
%
|
|
|
|
22
|
%
|
|
|
|
24
|
%
|
|
|
|
|
Subscriptions, advertising and other
|
|
|
|
|
|
|
|
7
|
%
|
|
|
|
9
|
%
|
|
|
|
9
|
%
|
|
|
|
8
|
%
|
|
|
|
6
|
%
|
|
|
|
|
Mobile
|
|
|
|
|
|
|
|
9
|
%
|
|
|
|
13
|
%
|
|
|
|
11
|
%
|
|
|
|
12
|
%
|
|
|
|
12
|
%
|
|
|
|
|
Total Digital
|
|
|
|
|
|
|
|
44
|
%
|
|
|
|
51
|
%
|
|
|
|
48
|
%
|
|
|
|
52
|
%
|
|
|
|
52
|
%
|
|
|
|
|
Total GAAP net revenue %
|
|
|
|
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
|
Packaged goods and other
|
|
|
|
|
|
|
|
38
|
%
|
|
|
|
63
|
%
|
|
|
|
51
|
%
|
|
|
|
33
|
%
|
|
|
|
23
|
%
|
|
|
|
|
Full game downloads
|
|
|
|
|
|
|
|
9
|
%
|
|
|
|
8
|
%
|
|
|
|
10
|
%
|
|
|
|
13
|
%
|
|
|
|
12
|
%
|
|
|
|
|
Extra content
|
|
|
|
|
|
|
|
27
|
%
|
|
|
|
13
|
%
|
|
|
|
22
|
%
|
|
|
|
27
|
%
|
|
|
|
37
|
%
|
|
|
|
|
Subscriptions, advertising and other
|
|
|
|
|
|
|
|
10
|
%
|
|
|
|
7
|
%
|
|
|
|
7
|
%
|
|
|
|
10
|
%
|
|
|
|
10
|
%
|
|
|
|
|
Mobile
|
|
|
|
|
|
|
|
16
|
%
|
|
|
|
9
|
%
|
|
|
|
10
|
%
|
|
|
|
17
|
%
|
|
|
|
18
|
%
|
|
|
|
|
Total Digital
|
|
|
|
|
|
|
|
62
|
%
|
|
|
|
37
|
%
|
|
|
|
49
|
%
|
|
|
|
67
|
%
|
|
|
|
77
|
%
|
|
|
|
|
Total Non-GAAP net revenue %
|
|
|
|
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
100
|
%
|
|
|
|
|
|
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES
|
Unaudited Supplemental Financial Information and Business Metrics
|
(in millions, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1
|
|
|
Q2
|
|
|
Q3
|
|
|
Q4
|
|
|
Q1
|
|
|
YOY %
|
|
|
|
|
|
|
|
FY15
|
|
|
FY15
|
|
|
FY15
|
|
|
FY15
|
|
|
FY16
|
|
|
Change
|
QUARTERLY NET REVENUE PRESENTATIONS - GAAP AND NON-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platform net revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Xbox One, PLAYSTATION 4
|
|
|
|
|
|
|
293
|
|
|
|
317
|
|
|
|
427
|
|
|
|
468
|
|
|
|
487
|
|
|
|
66
|
%
|
Xbox 360, PLAYSTATION 3
|
|
|
|
|
|
|
543
|
|
|
|
308
|
|
|
|
306
|
|
|
|
328
|
|
|
|
293
|
|
|
|
(46
|
%)
|
Other consoles
|
|
|
|
|
|
|
3
|
|
|
|
6
|
|
|
|
9
|
|
|
|
3
|
|
|
|
2
|
|
|
|
(33
|
%)
|
Total consoles
|
|
|
|
|
|
|
839
|
|
|
|
631
|
|
|
|
742
|
|
|
|
799
|
|
|
|
782
|
|
|
|
(7
|
%)
|
PC / Browser
|
|
|
|
|
|
|
231
|
|
|
|
208
|
|
|
|
218
|
|
|
|
221
|
|
|
|
253
|
|
|
|
10
|
%
|
Mobile
|
|
|
|
|
|
|
123
|
|
|
|
123
|
|
|
|
122
|
|
|
|
136
|
|
|
|
145
|
|
|
|
18
|
%
|
Other
|
|
|
|
|
|
|
21
|
|
|
|
28
|
|
|
|
44
|
|
|
|
29
|
|
|
|
23
|
|
|
|
10
|
%
|
Total GAAP net revenue
|
|
|
|
|
|
|
1,214
|
|
|
|
990
|
|
|
|
1,126
|
|
|
|
1,185
|
|
|
|
1,203
|
|
|
|
(1
|
%)
|
Xbox One, PLAYSTATION 4
|
|
|
|
|
|
|
(95
|
)
|
|
|
117
|
|
|
|
166
|
|
|
|
(92
|
)
|
|
|
(253
|
)
|
|
|
|
Xbox 360, PLAYSTATION 3
|
|
|
|
|
|
|
(268
|
)
|
|
|
63
|
|
|
|
106
|
|
|
|
(164
|
)
|
|
|
(204
|
)
|
|
|
|
Other consoles
|
|
|
|
|
|
|
-
|
|
|
|
(1
|
)
|
|
|
-
|
|
|
|
(1
|
)
|
|
|
-
|
|
|
|
|
Total consoles
|
|
|
|
|
|
|
(363
|
)
|
|
|
179
|
|
|
|
272
|
|
|
|
(257
|
)
|
|
|
(457
|
)
|
|
|
|
PC / Browser
|
|
|
|
|
|
|
(67
|
)
|
|
|
56
|
|
|
|
13
|
|
|
|
(49
|
)
|
|
|
(33
|
)
|
|
|
|
Mobile
|
|
|
|
|
|
|
(3
|
)
|
|
|
(6
|
)
|
|
|
17
|
|
|
|
16
|
|
|
|
(19
|
)
|
|
|
|
Other
|
|
|
|
|
|
|
(6
|
)
|
|
|
1
|
|
|
|
-
|
|
|
|
1
|
|
|
|
(1
|
)
|
|
|
|
Change in deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
(439
|
)
|
|
|
230
|
|
|
|
302
|
|
|
|
(289
|
)
|
|
|
(510
|
)
|
|
|
|
Xbox One, PLAYSTATION 4
|
|
|
|
|
|
|
198
|
|
|
|
434
|
|
|
|
593
|
|
|
|
376
|
|
|
|
234
|
|
|
|
18
|
%
|
Xbox 360, PLAYSTATION 3
|
|
|
|
|
|
|
275
|
|
|
|
371
|
|
|
|
412
|
|
|
|
164
|
|
|
|
89
|
|
|
|
(68
|
%)
|
Other consoles
|
|
|
|
|
|
|
3
|
|
|
|
5
|
|
|
|
9
|
|
|
|
2
|
|
|
|
2
|
|
|
|
(33
|
%)
|
Total consoles
|
|
|
|
|
|
|
476
|
|
|
|
810
|
|
|
|
1,014
|
|
|
|
542
|
|
|
|
325
|
|
|
|
(32
|
%)
|
PC / Browser
|
|
|
|
|
|
|
164
|
|
|
|
264
|
|
|
|
231
|
|
|
|
172
|
|
|
|
220
|
|
|
|
34
|
%
|
Mobile
|
|
|
|
|
|
|
120
|
|
|
|
117
|
|
|
|
139
|
|
|
|
152
|
|
|
|
126
|
|
|
|
5
|
%
|
Other
|
|
|
|
|
|
|
15
|
|
|
|
29
|
|
|
|
44
|
|
|
|
30
|
|
|
|
22
|
|
|
|
47
|
%
|
Total Non-GAAP net revenue
|
|
|
|
|
|
|
775
|
|
|
|
1,220
|
|
|
|
1,428
|
|
|
|
896
|
|
|
|
693
|
|
|
|
(11
|
%)
|
Xbox One, PLAYSTATION 4
|
|
|
|
|
|
|
24
|
%
|
|
|
32
|
%
|
|
|
38
|
%
|
|
|
39
|
%
|
|
|
41
|
%
|
|
|
|
Xbox 360, PLAYSTATION 3
|
|
|
|
|
|
|
45
|
%
|
|
|
31
|
%
|
|
|
27
|
%
|
|
|
28
|
%
|
|
|
24
|
%
|
|
|
|
Other consoles
|
|
|
|
|
|
|
-
|
|
|
|
1
|
%
|
|
|
1
|
%
|
|
|
-
|
|
|
|
-
|
|
|
|
|
Total consoles
|
|
|
|
|
|
|
69
|
%
|
|
|
64
|
%
|
|
|
66
|
%
|
|
|
67
|
%
|
|
|
65
|
%
|
|
|
|
PC / Browser
|
|
|
|
|
|
|
19
|
%
|
|
|
21
|
%
|
|
|
19
|
%
|
|
|
19
|
%
|
|
|
21
|
%
|
|
|
|
Mobile
|
|
|
|
|
|
|
10
|
%
|
|
|
12
|
%
|
|
|
11
|
%
|
|
|
12
|
%
|
|
|
12
|
%
|
|
|
|
Other
|
|
|
|
|
|
|
2
|
%
|
|
|
3
|
%
|
|
|
4
|
%
|
|
|
2
|
%
|
|
|
2
|
%
|
|
|
|
Total GAAP net revenue %
|
|
|
|
|
|
|
100
|
%
|
|
|
100
|
%
|
|
|
100
|
%
|
|
|
100
|
%
|
|
|
100
|
%
|
|
|
|
Xbox One, PLAYSTATION 4
|
|
|
|
|
|
|
26
|
%
|
|
|
36
|
%
|
|
|
41
|
%
|
|
|
42
|
%
|
|
|
34
|
%
|
|
|
|
Xbox 360, PLAYSTATION 3
|
|
|
|
|
|
|
35
|
%
|
|
|
30
|
%
|
|
|
29
|
%
|
|
|
18
|
%
|
|
|
13
|
%
|
|
|
|
Other consoles
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1
|
%
|
|
|
-
|
|
|
|
-
|
|
|
|
|
Total consoles
|
|
|
|
|
|
|
61
|
%
|
|
|
66
|
%
|
|
|
71
|
%
|
|
|
60
|
%
|
|
|
47
|
%
|
|
|
|
PC / Browser
|
|
|
|
|
|
|
21
|
%
|
|
|
22
|
%
|
|
|
16
|
%
|
|
|
19
|
%
|
|
|
32
|
%
|
|
|
|
Mobile
|
|
|
|
|
|
|
15
|
%
|
|
|
10
|
%
|
|
|
10
|
%
|
|
|
17
|
%
|
|
|
18
|
%
|
|
|
|
Other
|
|
|
|
|
|
|
3
|
%
|
|
|
2
|
%
|
|
|
3
|
%
|
|
|
4
|
%
|
|
|
3
|
%
|
|
|
|
Total Non-GAAP net revenue %
|
|
|
|
|
|
|
100
|
%
|
|
|
100
|
%
|
|
|
100
|
%
|
|
|
100
|
%
|
|
|
100
|
%
|
|
|
|
|
|
ELECTRONIC ARTS INC. AND SUBSIDIARIES
|
Unaudited Supplemental Financial Information and Business Metrics
|
(in millions, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1
|
|
|
Q2
|
|
|
Q3
|
|
|
Q4
|
|
|
Q1
|
|
|
YOY %
|
|
|
|
|
|
|
|
|
FY15
|
|
|
FY15
|
|
|
FY15
|
|
|
FY15
|
|
|
FY16
|
|
|
Change
|
CASH FLOW DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating cash flow
|
|
|
|
|
|
|
|
4
|
|
|
|
183
|
|
|
682
|
|
|
198
|
|
|
|
(71
|
)
|
|
|
(1,875
|
%)
|
Operating cash flow - TTM
|
|
|
|
|
|
|
|
964
|
|
|
|
1,153
|
|
|
1,150
|
|
|
1,067
|
|
|
|
992
|
|
|
|
3
|
%
|
Capital expenditures
|
|
|
|
|
|
|
|
27
|
|
|
|
21
|
|
|
15
|
|
|
32
|
|
|
|
24
|
|
|
|
(11
|
%)
|
Capital expenditures - TTM
|
|
|
|
|
|
|
|
95
|
|
|
|
92
|
|
|
79
|
|
|
95
|
|
|
|
92
|
|
|
|
(3
|
%)
|
Repurchase and retirement of common stock
|
|
|
|
|
|
|
|
50
|
|
|
|
95
|
|
|
97
|
|
|
95
|
|
|
|
132
|
|
|
|
164
|
%
|
BALANCE SHEET DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
|
1,554
|
|
|
|
1,624
|
|
|
2,166
|
|
|
2,068
|
|
|
|
1,810
|
|
|
|
16
|
%
|
Short-term investments
|
|
|
|
|
|
|
|
762
|
|
|
|
764
|
|
|
774
|
|
|
953
|
|
|
|
1,069
|
|
|
|
40
|
%
|
Cash and cash equivalents, and short-term investments
|
|
|
|
|
|
|
|
2,316
|
|
|
|
2,388
|
|
|
2,940
|
|
|
3,021
|
|
|
|
2,879
|
|
|
|
24
|
%
|
Receivables, net
|
|
|
|
|
|
|
|
219
|
|
|
|
829
|
|
|
488
|
|
|
362
|
|
|
|
144
|
|
|
|
(34
|
%)
|
Deferred net revenue (online-enabled games)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
End of the quarter
|
|
|
|
|
|
|
|
1,051
|
|
|
|
1,281
|
|
|
1,583
|
|
|
1,283
|
|
|
|
775
|
|
|
|
(26
|
%)
|
Less: Beginning of the quarter
|
|
|
|
|
|
|
|
1,490
|
|
|
|
1,051
|
|
|
1,281
|
|
|
1,583
|
|
|
|
1,283
|
|
|
|
|
Change in deferred net revenue (online-enabled games)2
|
|
|
|
|
|
|
|
(439
|
)
|
|
|
230
|
|
|
302
|
|
|
(300
|
)
|
|
|
(508
|
)
|
|
|
|
STOCK-BASED COMPENSATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue
|
|
|
|
|
|
|
|
-
|
|
|
|
1
|
|
|
1
|
|
|
-
|
|
|
|
-
|
|
|
|
|
Research and development
|
|
|
|
|
|
|
|
16
|
|
|
|
23
|
|
|
22
|
|
|
21
|
|
|
|
26
|
|
|
|
|
Marketing and sales
|
|
|
|
|
|
|
|
4
|
|
|
|
6
|
|
|
6
|
|
|
5
|
|
|
|
5
|
|
|
|
|
General and administrative
|
|
|
|
|
|
|
|
9
|
|
|
|
10
|
|
|
10
|
|
|
10
|
|
|
|
14
|
|
|
|
|
Total stock-based compensation
|
|
|
|
|
|
|
|
29
|
|
|
|
40
|
|
|
39
|
|
|
36
|
|
|
|
45
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2 The difference between the balances of deferred net
revenue (online-enabled games) does not always equal the change in
deferred net revenue (online-enabled games) in the GAAP to
Non-GAAP consolidated statement of operations reconciliation due
to the impact of unrecognized gains/losses on cash flow hedges.
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20150730006530/en/
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