The U.S. video game company Electronic Arts Inc on Tuesday shared a full-year forecast for adjusted revenue that came above the Wall Street estimates, coming on the heels of surge in videogame sales as coronavirus-led lockdowns forced people to stay-at-home seeking online engagement and entertainment activities.
In the United States videogames sales remain increasingly widening in the last two months as the spread of virus led the government to issue shut down orders and resultantly million of people in the country stuck at their homes, which also brought the sales in March at its highest ever in the decade.
Analysts are expecting videogame sales increasing further across all platforms if the lockdown orders came to be extending.
However, stock price of EA fell nearly 5% in the after hour trading on the day, to which Wedbush analyst Michael Pachter said that in my opinion investors were hoping lockdown orders would be driving sales growth to more than their earlier expectations.
Company was a bit conservative in its forecast while investors were expecting too high. Pachter added.
EA has a history of going parallel to its peer Take-Two Interactive Software Inc and Activision Blizzard Inc to remain conservative while issuing guidance at the start of business year.
In the fourth quarter ended March 31, EA generated revenue of $832 million from its live services which was 17% more than that in a year ago quarter, company said.
The Redwood City, California-based game publisher’s full-year revenue forecast of $5.55 billion beat the analysts’ average estimate of $5.37 billion for the same.
The company’s after adjustment quarterly revenue $1.21 billion though remained less than that of $1.36 in the year ago quarter but succeeded to slightly beat the analysts’ estimates of $1.19 billion, according to IBES data from Refinitiv.
Net income rose to $418 million, or $1.43 per share from that of $209 million, or 69 cents per share of a year ago quarter.