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.
Sign up for Kiplinger’s Free E-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
-
Stock Market Today: Stocks Stable as Inflation, Tariff Fears EbbConstructive trade war talks and improving consumer expectations are a healthy combination for financial markets.
-
What Trump’s 'Big Beautiful Bill' Means for Your Utility BillsIf passed, the 'Big Beautiful Bill' could make home energy upgrades more expensive and raise monthly costs. Here's how much more you might pay and how to prepare.
-
Stock Market Today: Stocks Stable as Inflation, Tariff Fears Ebb
Constructive trade war talks and improving consumer expectations are a healthy combination for financial markets.
-
Eight Estate Planning Steps to Protect Your Loved Ones (and Your Legacy)Two-thirds of Americans don't have an estate plan. If you're one of them, these are the essential steps to take now to prevent problems for your family later.
-
The Six Pros This Adviser Says You Need to Sell Your BusinessSelling your business isn't as simple as getting the best price and walking away. These are the six professionals you'll need to get a deal across the finish line.
-
The Three C's to Financial Success: A Financial Planner's Guide to Build WealthConsistency, commitment and confidence in your chosen strategy are more critical to your financial success than finding the 'perfect' financial plan.
-
A Financial Adviser's Guide to Solving Your Retirement Puzzle: Five Key PiecesIf retirement's a puzzle you're struggling with, try answering these five questions. The answers will guide you toward a solution.
-
You're Close to Retirement and Cashed Out: How Do You Get Back In?If you've been scared into an all-cash position, it's wise to consider reinvesting your money in the markets. Here's how a financial planner recommends you can get back in the saddle.
-
After the Disaster: An Expert's Guide to Deciding Whether to Rebuild or RelocateHomeowners hit by disaster must weigh the emotional desire to rebuild against the financial realities of insurance coverage, unexpected costs and future risk.
-
A Financial Expert's Tips for Lending Money to Family and FriendsWhat starts as a lifeline can turn into a minefield if the borrower ghosts the lender. Following these three steps can help you avoid family feuds over funds.
