Electronic Arts Lowers 2025 Revenue Outlook Yet Announces Buyback

Electronic Arts Inc. cuts its revenue expectations for 2025 while revealing a $1 billion share repurchase plan. This dual announcement may affect investor sentiment and stock prices in the near term.

Date: 05-02-2025

AI Rating: 5

Revenue Growth: Electronic Arts revised its expected revenue for the full year 2025 to between $7.250 billion and $7.400 billion. This represents a reduction from its prior forecast of $7.400 billion to $7.700 billion, indicating a potential slowdown in growth.

Earnings Per Share (EPS): The company's earnings per share guidance has been adjusted to approximately $3.90 to $4.25, down from earlier expectations of $3.82 to $4.33. This slight decrease might suggest a contraction in profitability or lower-than-anticipated performance.

Share Repurchase Plan: On a positive note, EA announced a $1 billion accelerated share repurchase, signaling management's confidence in the company's future. This could have a supportive effect on the stock price as it reduces the number of shares outstanding, potentially increasing the EPS.

Dividend Declaration: EA has declared a quarterly dividend of $0.19 per share, payable in March 2025. The commitment to returning capital to shareholders may bolster investor confidence, although the share buyback and dividend comes amid a lowered growth outlook.

Stocks: EA