EA Earnings Report Q1 FY14: 76% of our revenue this Q1 came from digital sales.
According to EA’s Q1 Fy14 financial report, the Publisher/Developer had a solid quarter driven by continued digital growth and disciplined cost management. As reported by EA labels boss Frank Gibeau the company has a full commitment when it comes to digital sales, and due to the capabilities of the next-gen consoles the business appears to be moving that way.
“The business is going digital. Mobile. Asia. A significant part of the business is in Asia. Does that mean retail is going away? No. But it’s not an experiment. It’s what we’re all about.”
In accordance with EA’s financial report, the revenue for the Q1 came primarily from digital sales which provided $482 million in revenue and add up to a total GAAP net revenue of $949 million.
The company also revealed Apple was EA’s biggest retail partner, essentially because EA made quite a lot of its revenue on the mobile software sales.
“We’re seeing console game levels of return, financially, on these projects. We’re seeing audiences that are vastly bigger. Our creative times are intrigued by designing games for mobile devices,”
“That’s never happened before. John Riccitiello started us on this course, but we embrace it, we support it, and we’re going to take it to new heights,”
Digital sales present a good growth with a strong trend; the company reported a 17% increase in revenue from digital POS and digital sales made up 76% of EA’s quarterly revenue. This is the first time that EA’s digital sales have outpaced retail sales.
It is also important to point out that EA’s net revenue of $495 million (non-GAAP) exceeded the target of $450 million; however, based on the net revenue the company reported a diluted loss per share of ($0.40).
This is definitely better news than we had from EA at Q4 FY13 where, amidst the Simcity launch disaster, EA laid off approximately 10% of its staff.
The Report Highlights
- EA was the #1 publisher in Western retail markets in calendar year 2013, and the #4 global publisher in the iOS game market in the June quarter.
- EA received 116 E3 awards from over 220 industry nominations, including 8 out of 15 awards from the official E3 Game Critics. Battlefield 4™ won a total of 21 awards at E3, including GameSpot’s Best of E3 award, Need for Speed™ Rivals was named Best Racing Game, and NHL® 14 took the honors for Best Sports Game. Titanfall™ from Respawn Entertainment won six major awards, including Best of Show, Best Original Game, Best Console Game, Best PC Game, Best Action Game and Best Online Multiplayer.
- The Simpsons™: Tapped Out recorded its highest revenue quarter in Q1 since launching in August 2012.
- EA’s mobile and handheld digital revenue generated $103 million* in the quarter, a 30% year-over-year increase in digital net revenue.
- Real Racing™ 3, the #1 racing title on iOS, has generated more than 45 million downloads, and has averaged over 2 million daily active users since launching in March.
- The Battlefield 3™ Premium community continues to grow with over 4 million members to date.
- FIFA 13 digital net revenue topped $70 million* in the quarter, a 92% increase versus FIFA 12 in Q1 FY 2013.
- FIFA Online 3 digital net revenue in grew 88%* in the first quarter compared FIFA Online 2 in the prior year, and was the #1 online sports game in Korea based on revenue and traffic.
- EA signs publishing agreement with TenCent for FIFA Online 3 in China, with details to be announced in an upcoming joint press release from EA and TenCent.
- EA’s Origin™ platform for downloading digital games has registered over 50 million users, including 22 million mobile users.
- Trailing twelve-month non-GAAP digital net revenue was up 28% to a record $1.72 billion.