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
-
Is Your Company Age-Friendly? Most Companies Say They Are But Employees Don't See ItIn recent years, many companies have stepped up their efforts to attract and retain older workers. But many older workers aren't seeing the impact. Here's what to do about it.
-
Is GE Aerospace Stock Still a Buy After Earnings?GE Aerospace stock is higher Thursday after the industrial firm topped analysts' fourth-quarter expectations and issued a strong full-year outlook. Here's what you need to know.
-
Is GE Aerospace Stock Still a Buy After Earnings?
GE Aerospace stock is higher Thursday after the industrial firm topped analysts' fourth-quarter expectations and issued a strong full-year outlook. Here's what you need to know.
-
American Airlines Stock Sinks After Earnings. Here's WhyAmerican Airlines stock is lower Thursday as the air carrier's weak outlook offsets its fourth-quarter earnings and revenue beats. Here, we look at the numbers.
-
How to Get Your Kids into Investing: A Family Project to TryTo teach your children about investing, put your money where your mouth is with this fun and potentially profitable exercise.
-
Four Ways to Invest in Quantum ComputingQuantum computing offers mind-boggling problem-solving potential. Here are four ways to buy quantum computing stocks.
-
Stock Market Today: Earnings and AI Send Stocks to New HighsA massive investment in artificial intelligence and upbeat earnings pushed equities to record levels.
-
Why the 10-Year U.S. Treasury Yield Is So Important Right NowMultiple indicators will track performance and sentiment during the second Trump administration. Here's why the 10-year U.S. Treasury yield is one to watch.
-
Oracle Stock Surges on Trump's Stargate ProjectOracle stock is higher Wednesday after President Trump announced the $500 billion AI-focused Stargate Project. Here's what you need to know.
-
Is Netflix Stock Still a Buy After Earnings, Price Hikes?Analysts were bullish on Netflix stock ahead of its earnings beat, but what is Wall Street saying now? We take a closer look.
