Video game company Electronic Arts saw revenues rise to $1.87 billion in its fourth quarter, compared to a year-earlier $1.82 billion as sales from its EA Sports FIFA franchise soared.
At the same time, EA swung to a net loss of $12 million, compared to a year-earlier net profit at $225 million. The company, whose most popular game titles include FIFA 23, Star Wars Jedi: Survivor and The Sims franchise, saw its latest results come out amid slowing demand for video games after a boom during pandemic-era lockdowns.
EA reported an 11 percent rise in total net bookings for the past three months, reaching $1.94 billion, with net books for the EA Sports FIFA franchise growing 31 percent year-over-year.
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“Record live services performance and increased engagement, particularly from our EA Sports FIFA franchise, drove better-than-expected Q4 net bookings, capping a strong finish to the fiscal year. Looking ahead, our teams remain disciplined in prioritizing the player experience as we continue to focus our investments on long-term growth,” Chris Suh, CFO at EA, said in a statement that accompanied the fourth quarter financial results.
Andrew Wilson, CEO of Electronic Arts, told analysts during an after-market conference call that soft consumer spending of late had pushed video gamers to embrace the industry’s biggest and most recognizable brands, which were best placed to weather the prospect of a recession.
“They have less money that they’re willing to risk against new things or smaller things or unknown things,” Wilson said of current consumer sentiment, allowing popular blockbuster titles like EA’s The Sims and FIFA franchises to continue doing well during an economic slump.
Longer term, Wilson said EA was developing video games over extended periods and for increasingly connected ecosystems, rather just develop a gaming world with unique characters for release and sale on limited platforms. “It’s really not just about the complexity of games, it’s really about the changing nature of what we’re building, but more importantly, the changing nature of how we derive value from that development over the long term,” he told analysts.
Wilson also discussed Microsoft’s Activision Blizzard deal facing long odds after the U.K. regulator blocked the blockbuster merger. “We’re indifferent as to whether that goes through or not. We feel like we have an incredible strategy. And whether it goes through or not, we’ll continue to be the number one publisher on the Microsoft platform,” he argued.
And Wilson predicted the video game giant will be a major beneficiary of artificial intelligence tools and apps: “That will allow us to do what we currently do more efficiently. It will allow us to actually do more things as we think about being creators.”
At the same time, Wilson pointed to concerns about AI putting people out of jobs and so disrupting workforces or leading to online gaming fraud. “Our plan will be to work with others in the industry and others in governments and regulators over time, to help laws keep up with the pace of AI so that our consumers, our players, our fans aren’t subjected to bad actors and fraudulent behavior as a result of AI in our industry,” he said.
During the latest three month period for EA, live services and other net bookings reached $1.62 billion, a record for the fourth quarter.
