Electronic Arts (EA) AI Stock Analysis

• Market Cap: $50.12B
• Dividend Yield: 0.38%
• Average Volume (3M): 4.63M
• Price to Earnings (P/E): 50.3
• Beta (1Y): 0.40
• Revenue Growth: 2.68%
• EPS Growth: -6.15%
• Country: US
• Employees: 13,700
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 1.25
• Shares Outstanding: 250,207,300
• 10 Day Avg. Volume: 3,157,707
• 30 Day Avg. Volume: 4,631,062
• PEG Ratio: -3.70
• Price to Book (P/B): 5.93
• Price to Sales (P/S): 5.07
• P/FCF Ratio: 20.38
• Enterprise Value/Market Cap: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: 0.00
• 1Y Price Target: $195.10
• Price Target Upside: -2.60% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 23

• Rating: 75 Outperform
• Price Target: $218.00 ▲(8.84% Upside)

Electronic Arts' strong financial performance and positive earnings call sentiment are the primary drivers of its stock score. While the technical analysis shows bullish momentum, the high P/E ratio and low dividend yield suggest valuation concerns. The company's strategic focus on new game launches and AI-driven growth supports a positive long-term outlook.

Positive Factors

Revenue Growth

EA's consistent revenue growth reflects its strong market position and ability to expand its customer base, ensuring long-term financial health.

Strong Cash Flow

Robust cash flow generation indicates efficient operations and provides flexibility for strategic investments and shareholder returns.

Upcoming Game Releases

A strong pipeline of game releases positions EA to capitalize on consumer demand and maintain engagement, supporting future revenue growth.

Negative Factors

Decline in Live Services

A decline in live services bookings can impact recurring revenue streams, posing a risk to EA's long-term financial stability.

Increased Operating Expenses

Rising operating expenses, driven by higher personnel costs, could pressure margins and reduce profitability if not managed effectively.

Potential Going Private Deal

A potential going private deal could lead to strategic shifts and impact EA's public market operations, affecting transparency and investor relations.

Electronic Arts Business Overview & Revenue Model

Company Description

Electronic Arts Inc. develops, markets, publishes, and distributes games, content, and services for game consoles, PCs, mobile phones, and tablets worldwide. It develops and publishes games and services across various genres, such as sports, racing, first-person shooter, action, role-playing, and simulation primarily under the Battlefield, The Sims, Apex Legends, Need for Speed, and license games from others, including FIFA, Madden NFL, UFC, and Star Wars brands. The company licenses its games to third parties to distribute and host its games. It markets and sells its games and services through digital distribution and retail channels, as well as directly to mass market retailers, specialty stores, and distribution arrangements. Electronic Arts Inc. was incorporated in 1982 and is headquartered in Redwood City, California.

How the Company Makes Money

EA generates revenue through several key streams: first, through the sale of game titles, which can include physical and digital copies of their games. Second, EA utilizes a robust microtransaction model within its games, particularly through in-game purchases like virtual currency, cosmetic items, and downloadable content (DLC). Subscription services, such as EA Play, offer members access to a library of games for a recurring fee, contributing to steady revenue. Additionally, EA engages in partnerships and licensing agreements, particularly in sports franchises, enabling them to leverage real-world leagues and athletes, further enhancing brand visibility and revenue potential. The company's focus on live services and ongoing content updates also helps maintain player engagement and monetization over time.

Electronic Arts Financial Statement Overview

Summary

Electronic Arts demonstrates strong financial health with stable revenue growth, strong profitability margins, and a solid balance sheet with low leverage. Cash flows are robust, supporting ongoing operations and investments. However, the volatility in free cash flow growth due to capital expenditure fluctuations is a point to monitor.

Income Statement

Electronic Arts demonstrates strong profitability with a consistent gross profit margin of around 79% and a net profit margin of 14% in TTM. Revenue growth is stable, showing a slight increase in recent periods, while the EBIT and EBITDA margins are healthy at 19% and 24% respectively, indicating efficient cost management.

Balance Sheet

The balance sheet shows a solid equity base with an equity ratio of 52% in TTM, indicating financial stability. The debt-to-equity ratio is well-managed at 0.24, suggesting low financial leverage. Return on equity is decent at 17%, reflecting effective use of shareholders' capital.

Cash Flow

The company's cash flow performance is robust, with a strong operating cash flow to net income ratio of 1.9, demonstrating excellent cash generation capability. The free cash flow to net income ratio is also favorable at 1.68, highlighting efficient capital expenditure management. However, the free cash flow growth rate shows volatility due to fluctuations in capital expenditure.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	7.47B	7.46B	7.56B	7.43B	6.99B	5.63B
Gross Profit	5.92B	5.92B	5.85B	5.63B	5.13B	4.13B
EBITDA	1.88B	2.02B	2.05B	1.92B	1.63B	1.24B
Net Income	1.04B	1.12B	1.27B	802.00M	789.00M	837.00M
Balance Sheet
Total Assets	11.70B	12.37B	13.42B	13.46B	13.80B	13.29B
Cash, Cash Equivalents and Short-Term Investments	1.63B	2.25B	3.26B	2.77B	3.06B	6.37B
Total Debt	1.95B	1.95B	1.95B	1.95B	1.96B	1.95B
Total Liabilities	5.62B	5.98B	5.91B	6.17B	6.17B	5.45B
Stockholders Equity	6.08B	6.39B	7.51B	7.29B	7.63B	7.84B
Cash Flow
Free Cash Flow	1.75B	1.86B	2.12B	1.34B	1.71B	1.81B
Operating Cash Flow	1.98B	2.08B	2.31B	1.55B	1.90B	1.93B
Investing Cash Flow	17.00M	37.00M	-207.00M	-217.00M	-2.80B	-505.00M
Financing Cash Flow	-2.88B	-2.86B	-1.62B	-1.60B	-1.62B	-15.00M

Electronic Arts Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 200.30
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EA, the sentiment is Positive. The current price of 200.3 is below the 20-day moving average (MA) of 200.50, above the 50-day MA of 184.42, and above the 200-day MA of 154.79, indicating a neutral trend. The MACD of 4.62 indicates Positive momentum. The RSI at 72.02 is Negative, neither overbought nor oversold. The STOCH value of 41.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EA.

Electronic Arts Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NTES	―	$88.76B	19.69	24.36%	1.99%	2.86%	19.96%
EA	―	$50.12B	50.29	15.46%	0.38%	2.68%	-6.15%
RBLX	―	$88.53B	―	-401.21%	―	27.39%	16.59%
BILI	―	$11.96B	412.95	1.58%	―	22.89%	―
PLTK	―	$1.43B	16.49	―	10.53%	4.98%	-60.29%
Sector *	―	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
TTWO	―	$47.06B	―	-89.29%	―	7.33%	-7.46%

Electronic Arts Corporate Events

Electronic Arts Announces $55 Billion Acquisition Deal

On September 28, 2025, Electronic Arts announced an agreement to be acquired by a consortium including PIF, Silver Lake, and Affinity Partners in an all-cash transaction valued at approximately $55 billion. This acquisition, approved by EA’s Board of Directors, offers a 25% premium on EA’s share price and represents the largest all-cash sponsor take-private investment in history. The transaction aims to accelerate EA’s innovation and growth in the entertainment industry, with the company continuing to be led by CEO Andrew Wilson. The deal is expected to close in Q1 FY27, subject to regulatory and stockholder approvals, after which EA’s stock will be delisted from public markets.

The most recent analyst rating on (EA) stock is a Hold with a $200.00 price target. To see the full list of analyst forecasts on Electronic Arts stock, see the EA Stock Forecast page.

Electronic Arts Updates Severance Plan and Elects Directors

On August 14, 2025, Electronic Arts‘ Board of Directors approved amendments to the Change in Control Severance Plan, which now includes a pro rata bonus for the year of termination and updates to align with market practices. Additionally, during the company’s annual stockholder meeting on the same day, directors were elected, executive compensation was approved, and KPMG LLP was ratified as the independent auditor for the fiscal year ending March 31, 2026.

The most recent analyst rating on (EA) stock is a Buy with a $183.00 price target. To see the full list of analyst forecasts on Electronic Arts stock, see the EA Stock Forecast page.

EA Earnings Call: Strong Start Amid Challenges

Electronic Arts Inc. (EA) recently held its earnings call, reflecting a strong start to the fiscal year with notable growth in key franchises and promising future launches. Despite these positive developments, the company faces challenges, including a decline in live services and anticipated headwinds in the second quarter for certain segments.

Electronic Arts Reports Strong Q1 FY26 Results

Electronic Arts Inc., a leader in digital interactive entertainment, develops and delivers games, content, and online services for consoles, mobile devices, and PCs.

Electronic Arts Declares Cash Dividend Amid Strong Results

On July 25, 2025, Electronic Arts declared a cash dividend of $0.19 per share, payable on September 17, 2025. The company reported strong financial results for the first quarter of fiscal year 2026, with net bookings of $1.298 billion, surpassing expectations. EA’s diverse portfolio, including EA SPORTS and Apex Legends, contributed to this success, and the company remains confident in its full-year guidance. EA also announced plans for the upcoming launch of Battlefield 6, highlighting its strategic focus on expanding player engagement and shaping the future of interactive entertainment.

The most recent analyst rating on (EA) stock is a Buy with a $183.00 price target. To see the full list of analyst forecasts on Electronic Arts stock, see the EA Stock Forecast page.