Electronic Arts Raises Guidance on Strong Quarter

Electronic Arts Inc. raised its guidance for its recently started fiscal year as the company turned in a better-than-expected performance for the quarter ended in June.

For the year, the company raised its per-share earnings estimate by a dime to $2.85 and lifted its revenue view to $4.45 billion, an increase of $50 million.

For the current quarter, the company forecast per-share earnings of roughly 40 cents and revenue of $1.075 billion. Analysts polled by Thomson Reuters expected per-share profit of 67 cents and revenue of $1.12 billion.

EA has benefited from continued growth in digital revenue, and analysts think it can continue that strength with its coming slate of games, which includes "Star Wars Battlefront."

Piper Jaffray said it expects the game to rank alongside massive hits like "Call of Duty" and "Grand Theft Auto" from rivals Activision Blizzard and Take-Two Interactive, respectively.

Sales from online-enabled games get booked during the quarter in which they were sold, under generally accepted accounting rules. However, EA also provides adjusted earnings and revenue figures in which such sales are spread out over the estimated life of the games it sells.

On that basis, which EA and analysts prefer to use as a measure of the company's operating performance, revenue fell 11% to $693 million for the latest quarter, but still topped the company's guidance for $640 million.

Adjusted earnings, which also exclude certain one-time items, were 15 cents a share, topping the company's forecast for break-even results.

Overall, under generally accepted accounting rules, Electronic Arts reported a profit of $442 million, or $1.32 a share, up from $335 million, or $1.04 a share, a year earlier. Revenue fell nearly 1% to $1.2 billion.

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