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EA Shares Tank After Lowering Revenue Expectations

Last Updated: July 1, 2023
The video game publisher delayed a much anticipated Star Wars release and lowered its annual revenue expectations after a rough three months.

Electronic Arts announced results for its third fiscal quarter on Tuesday, and the video game publisher cautiously lowered its revenue expectations by around half a billion dollars.

EA’s third quarter concluded on Dec. 31, 2022, and shows that the company moved its annual revenue expectations to around $7.07 billion to $7.17 billion. This is down from the $7.65 billion to $7.85 billion goal the company shared last quarter.

One factor affecting EA’s revenue forecast is the delayed release of Star Wars Jedi: Survivor. The video game publisher announced that the game would release on April 28, which is part of the next fiscal year. Star Wars Jedi: Survivor was initially slated to release on March 17.

Star Wars Jedi: Survivor is a sequel to Star Wars Jedi: Fallen Order, which was first released in 2019 and has drawn over 20 million players.

EA expected to hit $2.5 billion in Q3, but the gaming company missed that mark by over $600 million after only reaching $1.88 million in actual revenue. It was a rough quarter for EA, and investors feel it since the video game publisher’s shares fell by as much as 7% at the market close. Still, EA reported $622 million in game revenue, up from the $616 million the company brought in during the same quarter last year.

“In Q3, EA delivered high-quality experiences, driving record engagement across some of our biggest franchises and growing our player network. While our teams delivered for our players, the current macro environment impacted Q3 results,” EA CEO Andrew Wilson said in the report. “As we navigate the short-term, we’re focused on building for the long-term and remain confident about our future. With amazing talent, proven IP, and growing player network, EA is operating from a position of strength.”

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Here are some more high-level takeaways from EA’s recent earnings report:

  • EA ended Q3 with 650 million users in its player network.
  • Apex Legends Mobile and Battlefield Mobile will be discontinued in May after the mobile games failed to bring bigger audiences.
  • The company brought in $1.26 billion from live services and miscellaneous revenue.
  • FIFA 23 is pacing to be the biggest franchise title, likely due to gameplay during the 2022 World Cup.
  • The Sims attracted over 10 million new players.
  • The company hopes to bring in $1.7 to $1.8 billion in fourth-quarter revenue.

On another note, are video game trade shows out?

A day before EA dropped its quarterly earnings report, IGN exclusively reported that Xbox, Nintendo, and Sony are skipping E3 this summer. E3 is the Entertainment Software Association’s premier trade event for the video game industry. EA used to host a similar summer games showcase called EA Play Live, but the video game company hasn’t put the event on since the summer of 2021.

Are video game trade shows going out of business in favor of standalone gaming showcases? We’re unsure yet, but Xbox has confirmed it’s returning to LA for its annual summer showcase. The gaming console company hasn’t hosted a standalone showcase since the summer of 2019, the same year E3 was last hosted in person.

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About The Author
Michelai Graham
Michelai Graham
Michelai Graham is Boardroom's resident tech and crypto reporter. Before joining 35V, she was a freelance reporter with bylines in AfroTech, HubSpot, The Plug, and Lifewire, to name a few. At Boardroom, Michelai covers Web3, NFTs, crypto, tech, and gaming. Off the clock, you can find her producing her crime podcast, The Point of No Return.