EA Q4 FY14 digital revenue hits $491, firm bests expectations despite year-over-year decline
Electronic Arts has released its financial results for the fourth quarter of its 2014 fiscal year as well as full year results.
“While navigating through a year of tremendous change in the industry, which included a challenging console transition, we were able to exceed revenue guidance, lower our operating expenses, double operating cash flows, and invest in new products and services for the future,” said Chief Financial Officer Blake Jorgensen.
EA said for calendar year-to-date, EA was the number one publisher on PlayStation 4 and Xbox One consoles in the Western World led by FIFA 14, Titanfall and Battlefield 4, as well as Need For Speed:Rivals and Madden NFL 25.
In the fiscal fourth quarter, EA titles represented 40% of Western World combined title sales for the PlayStation 4 and Xbox One.
Mobile revenue set a new EA record, contributing nearly $460 million for the fiscal year, and the mobile business reached more than 130 million monthly active users in the fiscal year, and in Q4, EA mobile games were downloaded 143 million times.
EA’s Ultimate Team services generated more than $380 million in fiscal year 2014, with Madden Ultimate Team rowing 90% year-over-year.
Year-to-date, FIFA 14, Titanfall and Battlefield 4 were three of the top five bestselling titles across all platforms in the Western World.
By the Numbers
For the quarter, Digital Net Revenue came in at $491 million with Packaged Goods and Other Net Revenue hitting $618 million. Total Net Revenue came in at $1.12 billion, down 7.1% year-on-year but ahead of guidance.
For the full year, net revenue was down almost 6% from $3.8 billion in 2013 to $3.58 billion - but again, ahead of expectations. Profits came in at $2.23 billion compared to $2.41 billion the prior year.
Net income was down year-over-year from $98 million to $8 million.
Expenses for the quarter included $8 million in settlement costs related to the NCAA lawsuit. This cost is in addition to the $40 million of Q3.
Call to investors
During a post-release call to investors, EA said it beat guidance by cutting operating costs while meeting key revenue targets, despite the difficulties of console transitions.
Madden digital revenues grew 90% year-on-year, the publisher noted, and digital revenues now represent about 40% of total revenues. Madden reversed its sales trend this year; it normally dies off after Superbowl, but Ultimate Team and new content drops meant the sales graph actually went up.
Outlining its release schedule - which you can check out below - EA said it has an unannounced Frostbite-powered PlayStation 4 and Xbox One game for release in the third quarter, filling the hole left by Medal of Honor. EA would not confirm if this game is new IP or from an existing franchise.
EA will have this mystery title and six others on show at E3 2014. EA said explicitly that Star Wars: Battlefront is "coming along very well", and will be on show, so the mystery title is something else.
As expected, EA announced it plans to "continue its relationship" with Respawn Entertainment, having signed a new publishing agreement to bring "new Titanfall experiences" to audiences worldwide.
EA wouldn't expand on Titanfall's sales numbers, noting only that the NPD said it sold through 925,000 units in the US during the quarter. That figure does not include the Xbox 360 version, which is "off to a great start", EA said.
Asked about virtual reality, EA said Oculus VR has done a great job but the publisher waits for a strong install base before investing in new technologies.
On the subject of new IP, EA said it has multiple teams working on new properties and concepts, producing multiple protoypes every week.
The publisher also announced a $750 million buyback scheme.
Upcoming games
- EA Sports UFC - June 17
- Madden NFL 15 - summer
- FIFA 15 - summer
- NHL 15 - summer
- The Sims 4 - September at the latest
- Dragon Age: Inquisition - October
- NBA Live 15 - Q3/Q4
- New EA golf game - Q1 2015
- Mysterious new Frostbite game to be revealed at E3 - Q3
No NCAA or Need for Speed games this year; Ghost Games is working on a new Need for Speed with an extended development period.
Three map packs coming to Ttanfall, and two map packs for Battlefield 4. Daily content for Ultimate Team games will continue.
