While Electronic Arts (EA) reported some disappointing results in 2019, the company seems to have recovered financially in 2020, as they expected in their last earnings report.
The company’s optimistic forecasting has paid off, as they have reported an increase in Q4 and full-year earnings for 2020 year-on-year. The increase can be largely attributed to the company’s online services and digital sales.
For Q4 EA reported digital net revenue of $1.2 billion, which is up by 25 percent year-on-year. This actually makes up 88 percent of their total net revenue of $1.4 billion. Operating income for the quarter was up by 105 percent year-on-year at $401 million.
The total net bookings for Q4 for EA were $1.2 billion, made up of $832 million from live services (up by 17 percent year-on-year), $176 million from mobile (down by 3 percent year-on-year), and $211 million from full-game downloads (up by 25 percent year-on-year).
While mobile has shown a decline, the company added a caveat for their reports in 2021. EA will be lumping mobile in with an ‘other’ category, keeping it separate from key areas of the business. This is part of the vision for where the company is aiming to head over the next year.
EA’s full-year digital net revenue was up from $3.7 billion last year to $4.3 billion. Total net revenue sits at $5.5 billion, an increase from $4.95 billion the previous year, and also a brand new company record.
In 2019, EA’s net income sat at $1 billion, and that was with the aid of a one-off tax benefit. This year net income sits at $3 billion, a huge increase. Operating income has also improved, now at $1.4 billion for the year.
Digital net bookings for the year were up by 9 percent year-on-year at $4 billion, and account for 78 percent of all net bookings, which totaled $5.2 billion for the year. In 2019, digital net bookings accounted for 75 percent of all net bookings, and 68 percent in 2018.
EA expects Q1 net revenues to be at $1.2 billion, with a net income of $270 million, and $1 billion in net bookings. Currently the company has two major games planned for the period, Command and Conquer Remastered, and Burnout Paradise for Nintendo Switch.
The company anticipates full-year net revenues to hit $5.5 billion, with a net income of $978 million, and $5.5 billion in net bookings. So far for Q2 EA has FIFA 21 and Madden NFL 21 planned, and NHL 21 for Q3. The company will also be announcing a brand new sports title, an EA HD title, soft launching two mobile games, revealing four games from third-party developers, announcing expansions for current games, and launching Medal of Honor VR.