Electronic Arts Set to Post Q4 Earnings: How to Play the Stock

Electronic Arts EA is set to report its fourth-quarter fiscal 2025 results on May 6.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

For fourth-quarter fiscal 2025, EA expects GAAP revenues between $1.682 billion and $1.832 billion and earnings per share in the range of 65 cents to $1.  

The Zacks Consensus Estimate for fiscal fourth-quarter revenues is pegged at $1.56 billion, indicating a decline of 6.18% from the figure reported in the year-ago quarter.

The consensus mark for fiscal fourth-quarter earnings is pegged at $1.11 per share, suggesting a decline of 18.98% from the year-ago reported figure. The earnings estimate has moved down 4.3% over the past 30 days.

Let us see how things have shaped up for the upcoming announcement.

Electronic Arts Inc. Price and EPS Surprise

Electronic Arts Inc. price-eps-surprise | Electronic Arts Inc. Quote

Factors to Consider

As Electronic Arts approaches its fourth-quarter fiscal 2025 earnings report, investors should consider maintaining current positions rather than initiating new ones at this juncture. The quarter is likely to have seen mixed performance across EA's portfolio, with several developments potentially impacting results.

EA's Global Football franchise is expected to have remained under pressure following the mid-single-digit decline reported in Q3. Despite the positive momentum seen after the January gameplay update and Team of the Year event, management guided for a low double-digit decline in Global Football franchise net bookings for the fourth quarter. This conservative outlook reflects ongoing challenges in player acquisition and engagement that may continue to weigh on results.

The March 6 release of Split Fiction, a unique co-op action-adventure game developed with Hazelight Studios, should provide some revenue offset to declines in other franchises. Priced at $49.99 across PlayStation 5, Xbox Series X|S, and PC platforms, this new IP launch was specifically mentioned in EA's guidance as partially offsetting expected declines in Global Football and Apex Legends.

The announcement of F1 25 in March is likely to have impacted the quarter's financials since its May 30 release falls in the next fiscal year. However, pre-orders might have contributed modestly to bookings. Meanwhile, the TRACAB Technologies acquisition announcement, while strategically important for EA's sports simulation capabilities, won't materially affect Q4 results as the transaction is expected to close in the first quarter of fiscal 2026.

American Football titles continued their strength, with EA previously noting this business remains on track to surpass $1 billion in net bookings for fiscal 2025. The anticipated summer 2025 release of College Football 26 is generating considerable excitement but falls outside this reporting period.

The company faces challenging year-over-year comparisons, with management guiding for fourth-quarter net bookings of $1.444-$1.594 billion, representing a decline of 4-13% from the prior year. EA's accelerated $1 billion stock repurchase program announced in the third quarter demonstrates management's confidence in long-term growth potential despite near-term headwinds.

Investors should watch engagement metrics across EA's sports franchises and commentary regarding the fiscal 2026 pipeline, which includes major releases like College Football 26 and Battlefield. These titles position EA for a potential return to growth in the coming fiscal year despite the current transitional period.

What Our Model Says

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not exactly the case here.

Electronic Arts currently has an Earnings ESP of -2.56% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:

StoneCo STNE has an Earnings ESP of +13.79% and sports a Zacks Rank of 1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

StoneCo shares have surged 76.4% year to date. STNE is set to report its first-quarter 2025 results on May 8.

Affirm AFRM presently has an Earnings ESP of +63.27% and flaunts a Zacks Rank #1. 

Affirm shares have plunged 17.1% year to date. AFRM is scheduled to report its fourth-quarter fiscal 2025 results on May 8.

Baidu BIDU currently has an Earnings ESP of +8.67% and a Zacks Rank #3.

Baidu shares are up 5.9% year to date. BIDU is slated to report its first-quarter 2025 results on May 21.

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This article originally published on Zacks Investment Research (zacks.com).

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