Electronic Arts (EA) is the worst S&P 500 stock Thursday after the video game maker released preliminary results for its fiscal 2025 third quarter and downwardly revised its full-year bookings forecast. At last check, EA stock was down more than 18%.
For its fiscal third quarter, EA said it now expects revenue of approximately $1.883 billion and earnings of roughly $1.11 per share. It had previously guided for revenue in the range of $1.875 billion to $2.025 billion and earnings between 85 cents and $1.02 per share.
"During Q3, we continued to deliver high-quality games and experiences across our portfolio; however, Dragon Age and EA SPORTS FC 25 underperformed our net bookings expectations," said Electronic Arts CEO Andrew Wilson in a statement.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
For the full fiscal year, EA now anticipates a mid-single-digit decline in net bookings after initially guiding for mid-single-digit growth. The company pointed to its Global Football unit as the primary reason for the downward revision.
"Global Football had experienced two consecutive fiscal years of double-digit net bookings growth. However, the franchise experienced a slowdown as early momentum in the fiscal third quarter did not sustain through to the end," EA said.
Electronic Arts will release its full fiscal third-quarter earnings report after the market closes on Tuesday, February 4.
Is Electronic Arts stock a buy, sell or hold?
Heading into Thursday's session, Electronic Arts was up 4% on a total return basis (price change plus dividends) in the past 12 months, underperforming the S&P 500's 27% gain. Yet, Wall Street remains bullish on the communication services stock.
According to S&P Global Market Intelligence, the average analyst target price for EA stock is $153.18, representing implied upside of more than 30% to current levels. Additionally, the consensus recommendation is a Buy. However, analysts may revise their ratings and price targets following the company's financial forecast.
Despite Electronic Arts' recent struggles, financial services firm Wedbush late Wednesday reiterated its Outperform rating (equivalent to a Buy) and $173 price target on the large-cap stock.
"EA fumbled badly in Q3 and will be in the penalty box until investors appreciate the magnitude of the earnings shortfall," says Wedbush analyst Michael Pachter. "EA shares may be 'dead money' for another quarter or so, but we remain confident in a rebound once the company provides visibility into its release schedule for fiscal years 2026 and 2027."
Related Content
-
Are COVID Shots Still Covered By Medicare?Getting the new COVID-19 vaccine covered by Medicare isn't as easy this year as it was in the past. Here's what you need to know before you take a trip to your pharmacy.
-
How Digital Platforms Are Changing the Way You Invest in GoldInvesting in gold is easier than ever thanks to digital platforms. Learn how online tools are lowering costs, increasing transparency and making gold accessible to all investors.
-
How Digital Platforms Are Changing the Way You Invest in Gold
Investing in gold is easier than ever thanks to digital platforms. Learn how online tools are lowering costs, increasing transparency and making gold accessible to all investors.
-
Stocks Rise to Start Fed Week: Stock Market TodayThe Nasdaq Composite and S&P 500 hit new record closing highs as Wall Street awaits the Fed's next rate cut.
-
Don't Disinherit Your Grandchildren: The Hidden Risks of Retirement Account Beneficiary FormsStandard retirement account beneficiary forms may not be flexible enough to ensure your money passes to family members according to your wishes. Naming a trust as the contingent beneficiary can help avoid these issues. Here's how.
-
This Is How Life Insurance Can Fund Your Dreams NowBeyond a death benefit, life insurance can provide significant financial value and flexibility through 'living benefits' while you are still alive, helping with expenses like education, business ventures or retirement.
-
Potential Trouble for Retirees: A Wealth Adviser's Guide to the OBBB's Impact on RetirementWhile some provisions might help, others could push you into a higher tax bracket and raise your costs. Be strategic about Roth conversions, charitable donations, estate tax plans and health care expenditures.
-
One Small Step for Your Money, One Giant Leap for RetirementSaving enough for retirement can sound as daunting as walking on the moon. But what would your future look like if you took one small step toward it this year?
-
This Is What You Really Need to Know About Medicare, From a Financial ExpertHealth care costs are a significant retirement expense, and Medicare offers essential but complex coverage that requires careful planning. Here's how to navigate Medicare's various parts, enrollment periods and income-based costs.
-
I'm a Financial Planner: Could Partial Retirement Be the Right Move for You?Many Americans close to retirement are questioning whether they should take the full leap into retirement or continue to work part-time.
