Electronic Arts (EA) AI Stock Analysis

• Market Cap: $40.28B
• Dividend Yield: 0.48%
• Average Volume (3M): 2.55M
• Price to Earnings (P/E): 40.4
• Beta (1Y): 0.47
• Revenue Growth: 2.68%
• EPS Growth: -6.15%
• Country: US
• Employees: 13,700
• Sector: Communication Services
• Sector Strength: 79
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 0.25
• Shares Outstanding: 250,207,300
• 10 Day Avg. Volume: 3,244,414
• 30 Day Avg. Volume: 2,554,582
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.02
• Enterprise Value/Revenue: 5.47
• Enterprise Value/Gross Profit: 6.91
• Enterprise Value/Ebitda: 22.69
• 1Y Price Target: $177.80
• Price Target Upside: 10.44% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 16

• Rating: 76 Outperform
• Price Target: $172.00 ▲(6.84% Upside)

Electronic Arts is positioned well for sustainable growth, driven by strong financial performance and strategic expansions in key franchises. While the high P/E ratio suggests market optimism, it also raises valuation concerns. The balanced technical indicators and positive earnings call insights support a favorable outlook, despite some risks in certain segments.

Positive Factors

Player engagement

The momentum from Battlefield Labs and early player sentiment appears grounded and authentic.

Strategic positioning

Launching the mode near or just after Call of Duty’s expected release could be a bold and effective strategy to retain players during a competitive window.

Technology innovation

EA management touted a revamp of Frostbite, EA’s proprietary game engine, to enable UGC and faster content releases via higher productivity due to AI and improved developer onboarding.

Negative Factors

Execution risk

New FTP mode hinted, but there is execution risk.

Uncertain future

Despite the strong performance in F1Q26, EA's FY26E guidance remains unchanged, indicating potential uncertainty in future releases.

Electronic Arts Business Overview & Revenue Model

Company Description

Electronic Arts Inc. (EA) is a leading global interactive entertainment company known for developing, publishing, and distributing video games and related content. Founded in 1982 and headquartered in Redwood City, California, EA operates in the video game industry, focusing on creating high-quality games for consoles, PCs, and mobile devices. The company's core products include popular franchises such as FIFA, Madden NFL, The Sims, and Battlefield, which are enjoyed by millions of players worldwide.

How the Company Makes Money

Electronic Arts makes money primarily through the sale of video games and associated content. The company's revenue streams include full game sales, live services, and mobile platforms. Full game sales involve the sale of physical and digital copies of EA's games. Live services encompass additional content such as downloadable content (DLC), in-game purchases, and subscription services like EA Play, which provide ongoing revenue beyond the initial game sale. Mobile gaming also represents a significant income source, with EA developing and monetizing games for smartphones and tablets. Key partnerships with sports organizations like FIFA and the NFL enhance EA's portfolio, allowing it to produce exclusive licensed sports games, further contributing to its earnings.

Electronic Arts Financial Statement Overview

Summary

Electronic Arts demonstrates strong financial health with consistent profitability and efficient cost management. The income statement shows robust revenue and profit growth, while the balance sheet reflects financial stability with low leverage. Cash flow is solid, though a decline in free cash flow indicates potential challenges in maintaining reserves.

Income Statement

Electronic Arts shows strong financial performance with consistent revenue and profit growth over the years. The gross profit margin remains healthy at 79%, and the net profit margin is solid at 15% TTM. Although there was a slight decline in revenue compared to the previous year, the company maintains strong profitability with high EBIT and EBITDA margins, indicating effective cost management and operational efficiency.

Balance Sheet

The balance sheet of Electronic Arts is stable, with a healthy equity ratio of 52% TTM, indicating strong financial stability. The debt-to-equity ratio is low at 0.23, demonstrating prudent financial leverage. However, a slight decline in stockholders' equity over the past year suggests careful monitoring is needed. Overall, the company's assets are well-managed, supporting long-term sustainability.

Cash Flow

Cash flow analysis shows robust operating cash flow, with a high operating cash flow to net income ratio of 1.85 TTM, signifying strong cash generation capability. However, the free cash flow has decreased by 12% from the previous year, which could indicate potential challenges in maintaining cash reserves for future investments. Nevertheless, the company effectively manages its capital expenditures, contributing to its sound cash flow position.

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	1.80B	2.02B	1.99B	1.81B	1.61B	1.23B
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	1.48B	1.95B	1.95B	1.88B	1.96B	1.88B
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: 160.99
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 160.99 is above the 20-day moving average (MA) of 152.72, above the 50-day MA of 151.71, and above the 200-day MA of 146.63, indicating a bullish trend. The MACD of 1.51 indicates Negative momentum. The RSI at 62.27 is Neutral, neither overbought nor oversold. The STOCH value of 90.46 is Negative, 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	85 Outperform	$83.20B	18.86	23.93%	2.17%	1.26%	6.84%
EA	76 Outperform	$40.28B	40.42	15.46%	0.48%	2.68%	-6.15%
RBLX	72 Outperform	$88.12B	―	-401.21%	―	27.39%	16.59%
BILI	69 Neutral	$9.49B	―	-4.29%	―	21.11%	87.93%
PLTK	61 Neutral	$1.66B	11.79	-220.61%	9.37%	1.64%	-32.31%
Sector *	56 Neutral	AU$3.55B	20.03	2.60%	4.20%	4.06%	-16.40%
TTWO	52 Neutral	$41.67B	―	-114.76%	―	5.31%	-15.57%

Electronic Arts Corporate Events

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.

EA Declares Cash Dividend Amid Strong Financial Results

On May 1, 2025, EA’s Audit Committee declared a cash dividend of $0.19 per share, payable on June 18, 2025. EA reported strong financial results for the fiscal year ending March 31, 2025, with net bookings totaling $7.355 billion and net revenue of $7.463 billion. The success of EA SPORTS and The Sims contributed to a record year, positioning the company for growth with upcoming releases like Battlefield in FY26. EA also repurchased 17.6 million shares for $2.5 billion during the fiscal year.