Electronic Arts released their Q3 FY 2014 results today, and the numbers, particularly revenue, are below expectations, at a loss of $ 308 million under GAAP principles.
GAAP does not take into account deferred revenue, however, so in non-GAAP terms, revenue is pegged at $ 764 million. This was still below market expectations of $ 825.7 million. Sales are at $ 1.57 billion, below expectations of $ 1.66 billion.
In terms of cash flow, EA reports a quarterly increase of 89 %, to the tune of $ 685 million, and a 76 % increase TTM, to the tune of $ 664 million.
EA invested into placing the most titles of any 3rd party company into Playstation 4 and Xbox One, and so they can cite themselves as the number 1 publisher on those consoles, particularly for titles like Battlefield 4 and FIFA 14. They comprised 35 % of sales for those platforms, and even more games like Titanfall are expected to keep their momentum going in the coming year.
However, EA felt the dropoff in interest in Playstation 3 and Xbox 360 games, which is where CFO Blake Jorgensen places the blame for the unexpected drop in revenue. In fact, in spite of the increase in revenue, EA’s major titles, FIFA 14, Madden 25 and Battlefield 4, generally debuted and sold less than their predecessors.
Jorgensen is nonetheless upbeat about the report, stating that they expect revenue to pick up in the coming two years over a solid release schedule, including not only Titanfall, but their UFC and Star Wars games.
