Electronic Arts Rallies After Beating Views, Raising Outlook

(Bloomberg) -- Electronic Arts Inc., maker of the Battlefield video games, rose in extended trading after reporting better-than-expected first-quarter results, buoyed by product launches and live services, and raising its outlook.

First-quarter adjusted revenue totaled $1.34 billion, the company said Wednesday, beating estimates of $1.29 billion. Profit, excluding some items, came to 79 cents in the period ended June 30, exceeding projections of 62 cents.

Existing games have been seeing strong user engagement, the company said. FIFA Ultimate Team matches are up 48% year-over-year for the quarter. Season 9 of Apex Legends set a new record for peak daily players across all seasons, EA said.

The momentum is expected to carry through the current quarter and year, Redwood City, California-based EA said. It’s projecting adjusted revenue of $1.73 billion this period, while analysts estimate $1.54 billion. The company expects second-quarter adjusted earnings of $1.10 a share, versus analysts’ projections of 84 cents.

Shares of EA rose as much as 5.3% to $147.32 in extended trading. The stock little changed at $139.91 at the close in New York and was down 2.6% this year.

For the year, EA expects adjusted revenue of $7.4 billion, in line with the average estimate of analysts. It’s forecasting earnings of $6.40 a share excluding items for the year ending next March, slightly below the $6.45 a share average of analysts’ estimates.

The company’s guidance doesn’t yet take into account any increases in unit sales of the upcoming Battlefield game, or the $1.4 billion acquisition of Playdemic, maker of the Golf Clash mobile game, which has yet to close, Blake Jorgensen, chief operating officer and chief financial officer, said in an interview.

The company also isn’t done making deals. “At the end of the day, we’re going to look at everything,” Jorgensen said.

The new, highly anticipated Battlefield 2042 will debut in time for the holidays, Electronic Arts said. The mobile Apex Legends is expected to go live in markets outside of China as soon as January of February, Jorgensen said.

“It looks fantastic, it’s testing very well,” he said.

The company is delaying the return of personnel to offices, from early September to some months later, but doesn’t expect that to impact its game-delivery schedule, Jorgensen said.

“We are working on new games, and we are comfortable we’ll be on time,” Jorgensen said.

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