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SOCIAL MEDIA

 

Electronic Arts Reports Q2 FY18 Financial Results

Category:

Tuesday, October 31, 2017 1:01 pm PDT

Dateline:

REDWOOD CITY, Calif.

Public Company Information:

NASDAQ:
EA
US2855121099
"The digital transformation is accelerating across our industry, and we are well-positioned for continued growth with more stunning new titles, thriving event-driven live services including competitive gaming, and continuing innovation for our players on all platforms."

REDWOOD CITY, Calif.--(BUSINESS WIRE)--Electronic Arts Inc. (NASDAQ: EA) today announced preliminary financial results for its second fiscal quarter ended September 30, 2017.

“It was a strong second quarter for Electronic Arts, with players around the world captivated by our new EA SPORTS titles, top-performing mobile games, and expanding esports competitions,” said Chief Executive Officer Andrew Wilson. “The digital transformation is accelerating across our industry, and we are well-positioned for continued growth with more stunning new titles, thriving event-driven live services including competitive gaming, and continuing innovation for our players on all platforms.”

“We saw a notable shift to digital in our sports titles and remarkable growth in Ultimate Team,” said Chief Financial Officer Blake Jorgensen. “Our sports titles have once again shown their value in delivering a stable and dependable performance. This quarter demonstrates how they can drive our business and offers a window into how our games will evolve over the months and years to come.”

News and ongoing updates regarding EA and its games are available on EA’s blog at www.ea.com/news.

Selected Operating Highlights and Metrics

  • Digital net bookings* for the trailing twelve months was $3.240 billion, up 26% year-over-year, and now represents 63% of total net bookings for the same period.
  • More than 50% of Madden NFL 18 players engaged in the “Longshot” story mode through Q2 and Madden Ultimate Team™ players are up 25% year-over-year.
  • FIFA Mobile unique player base grew to more than 113 million.
  • The BattlefieldTM 1 community grew to more than 23.5 million players worldwide.
  • Monthly active players for The SimsTM 4 on PC increased more than 40% year-over-year.

* Net bookings, previously referred to as net sales, is defined as the net amount of products and services sold digitally or sold-in physically in the period. Net bookings is calculated by adding total net revenue to the change in deferred net revenue for online-enabled games.

Selected Financial Highlights and Metrics

All financial measures are presented on a GAAP basis.

  • Net cash provided by operating activities was $52 million.
  • Net cash provided by operating activities for the trailing twelve months was $1.802 billion, a record measured at the end of the second quarter.
  • In Q2, EA repurchased 1.3 million shares for $153 million.

Quarterly Financial Highlights

  Three Months Ended September 30,
2017   2016
(in $ millions, except per share amounts)
Digital net revenue 689 566
Packaged goods and other net revenue 270   332  
Total net revenue 959   898  
 
Net loss (22 ) (38 )
Loss per share (0.07 ) (0.13 )
 
Operating cash flow 52

122

*

 
Value of shares repurchased 153 127
Number of shares repurchased 1.3 1.6
*At the beginning of fiscal 2018, EA adopted FASB ASU 2016-09, related to stock-based compensation. Operating cash flow for the three months ended September 30, 2016 has been recast to reflect the impact of this standard.
 

While EA no longer reports certain non-GAAP financial measures, the following GAAP-based financial data and a long-term tax rate of 21% are used internally by company management to adjust its GAAP results in order to assess EA’s operating results:

  Three Months Ended September 30, 2017
  GAAP-Based Financial Data
(in $ millions)

Statement

of

Operations

Acquisition-

related

expenses

 

Change in

deferred net

revenue

(online-

enabled

games)

  Stock-based

compensation

Total net revenue 959 - 220 -
Cost of revenue 389   -   - (1 )
Gross profit 570 - 220 1
Total operating expenses 611   (2 ) - (61 )
Operating income (loss) (41 ) 2 220 62
Interest and other income, net 3   -   - -  
Income (loss) before provision for (benefit from) income taxes (38 ) 2 220 62
Number of shares used in computation:
Basic and diluted 309
 

EA's GAAP loss per share for the three months ended September 30, 2017 was calculated using the basic share count of 309 million. Had EA reported a profit, the diluted share count would have been 312 million shares.

For more information about the nature of the GAAP-based financial data, please refer to EA’s Form 10-Q for the fiscal quarter ended June 30, 2017.

TTM Financial Highlights

  TTM Ended September 30,
2017   2016
(in $ millions)
Digital net revenue 3,187 2,539
Packaged goods and other net revenue 1,897 2,008
Total net revenue 5,084 4,547
 
Net income 1,187 1,256
 
Operating cash flow* 1,802 1,323
 
Value of shares repurchased 555 1,016
Number of shares repurchased 5.7 15.2
*At the beginning of fiscal 2018, EA adopted FASB ASU 2016-09, related to stock-based compensation. Operating cash flow has been recast to reflect the impact of this standard.
 

While EA no longer reports certain non-GAAP financial measures, the following GAAP-based financial data and a long-term tax rate of 21% are used internally by company management to adjust its GAAP results in order to assess EA’s operating results:

  TTM Ended September 30, 2017
  GAAP-Based Financial Data
(in $ millions)

Statement of

Operations

Acquisition-

related

expenses

 

Change in

deferred net

revenue

(online-

enabled

games)

  Stock-based

compensation

Total net revenue 5,084 - 32 -
Cost of revenue 1,261 (18 ) - (3 )
Gross profit 3,823 18 32 3
Total operating expenses 2,408 (6 ) - (207 )
Operating income 1,415 24 32 210
Interest and other income, net 6 -   - -  
Income before provision for income taxes 1,421 24 32 210
 

For more information about the nature of the GAAP-based financial data, please refer to EA’s Form 10-Q for the fiscal quarter ended June 30, 2017.

Operating Metric

EA has renamed the operating metric “net sales” to “net bookings”. The following is a calculation of our total net bookings for the periods presented:

  Three Months Ended
September 30,
  TTM Ended
September 30,
2017   2016 2017   2016
(in $ millions)
Total net revenue 959 898 5,084 4,547
Change in deferred net revenue (online-enabled games) 220 200 32 (40 )
Net bookings 1,179 1,098 5,116 4,507  
 

Business Outlook as of October 31, 2017

The following forward-looking statements reflect expectations as of October 31, 2017. Electronic Arts assumes no obligation to update these statements. Results may be materially different and are affected by many factors detailed in this release and in EA’s annual and quarterly SEC filings.

Fiscal Year 2018 Expectations – Ending March 31, 2018

Financial metrics:

  • Net revenue is expected to be approximately $5.075 billion.
    • Change in deferred net revenue (online-enabled games) is expected to be approximately $75 million.
  • Net income is expected to be approximately $1.136 billion.
  • Diluted earnings per share is expected to be approximately $3.63.
  • Operating cash flow, reflecting the recently adopted accounting standard related to stock-based compensation discussed below, is expected to be approximately $1.600 billion.
  • The Company estimates a share count of 313 million for purposes of calculating fiscal year 2018 diluted earnings per share.

Operational metric:

  • Net bookings is expected to be approximately $5.150 billion.

In addition, the following outlook for GAAP-based financial data and a long-term tax rate of 21% are used internally by EA to adjust our GAAP expectations to assess EA’s operating results and plan for future periods:

  Twelve Months Ending March 31, 2018
  GAAP-Based Financial Data

GAAP

Guidance

Acquisition-

related

expenses

 

Change in

deferred net

revenue

(online-

enabled

games)

 

Stock-based

compensation

(in $ millions)
Digital net revenue 3,295 - 115 -
Packaged goods & other net revenue   1,780   -     (40 )   -  
Total net revenue   5,075   -     75     -  
Cost of revenue 1,290 - - (3 )
Operating expense 2,443 (6 ) - (237 )
Income before provision for income taxes 1,344 6 75 240
Net income 1,136
Number of shares used in computation:
Diluted shares 313
 

Third Quarter Fiscal Year 2018 Expectations – Ending December 31, 2017

Financial metrics:

  • Net revenue is expected to be approximately $1.135 billion.
    • Change in deferred net revenue (online-enabled games) is expected to be approximately $865 million.
  • Net loss is expected to be approximately ($64) million.
  • Loss per share is expected to be approximately ($0.21).
  • The Company estimates a GAAP basic and diluted share count of 309 million shares due to a forecasted net loss. If the Company reports net income instead of a net loss, diluted share count for calculating diluted earnings per share would be 313 million shares.

Operational metric:

  • Net bookings is expected to be approximately $2.000 billion.

In addition, the following outlook for GAAP-based financial data and a long-term tax rate of 21% are used internally by EA to adjust our GAAP expectations to assess EA’s operating results and plan for future periods:

  Three Months Ending December 31, 2017
  GAAP-Based Financial Data

GAAP

Guidance

Acquisition-

related

expenses

 

Change in

deferred net

revenue

(online-

enabled

games)

 

Stock-based

compensation

(in $ millions)          
Total net revenue   1,135   -   865 -  
Cost of revenue 521 - - (1 )
Operating expense 690 (1 ) - (64 )
Income/(loss) before provision for (benefit from) income taxes (79 ) 1 865 65
Net loss (64 )
Number of shares used in computation:
Basic shares 309
 

Impact of Recently Adopted Accounting Standard

At the beginning of fiscal 2018, EA adopted FASB ASU 2016-09, related to stock-based compensation. This pronouncement required EA to change how it reports the cash effects of stock-based compensation in the Consolidated Statement of Cash Flow. It does not impact total cash and cash flow, but it does increase operating cash flow and decrease cash flow from financing activities. The following table reflects the impact of this standard on operating cash flow for the periods presented:

  Three Months Ended September 30,
(in $ millions) 2017   2016
Operating cash flow under historical GAAP 39 109
 
Operating cash flow under ASU 2016-09 52 122
Impact of ASU 2016-09 on operating cash flow 13 13
 

Conference Call and Supporting Documents

Electronic Arts will host a conference call on October 31, 2017 at 2:00 pm PT (5:00 pm ET) to review its results for the second fiscal quarter ended September 30, 2017 and its outlook for the future. During the course of the call, Electronic Arts may disclose material developments affecting its business and/or financial performance. Listeners may access the conference call live through the following dial-in number 844-215-4106 (domestic) or 918-534-8313 (international), using the password “EA” or via webcast at EA’s IR Website at http://ir.ea.com.

EA has posted a slide presentation and a financial model of EA’s historical results and guidance on EA’s IR Website. EA will also post the prepared remarks and a transcript from the conference call on EA’s IR Website.

A dial-in replay of the conference call will be available until November 14, 2017 at 855-859-2056 (domestic) or 404-537-3406 (international) using pin code 90760245. An audio webcast replay of the conference call will be available for one year on EA’s IR Website.

Forward-Looking Statements

Some statements set forth in this release, including the information relating to EA’s fiscal 2018 expectations under the heading “Business Outlook as of October 31, 2017,” contain forward-looking statements that are subject to change. Statements including words such as “anticipate,” “believe,” “estimate” or “expect” and statements in the future tense are forward-looking statements. These forward-looking statements are preliminary estimates and expectations based on current information and are subject to business and economic risks and uncertainties that could cause actual events or actual future results to differ materially from the expectations set forth in the forward-looking statements.

Some of the factors which could cause the Company’s results to differ materially from its expectations include the following: sales of the Company’s titles; the Company’s ability to develop and support digital products and services, including managing online security and privacy; the Company’s ability to manage expenses; the competition in the interactive entertainment industry; the effectiveness of the Company’s sales and marketing programs; timely development and release of Electronic Arts’ products; the Company’s ability to realize the anticipated benefits of acquisitions; the consumer demand for, and the availability of an adequate supply of console hardware units; the Company’s ability to predict consumer preferences among competing platforms; the Company’s ability to develop and implement new technology; foreign currency exchange rate fluctuations; general economic conditions; and other factors described in the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2017.

These forward-looking statements are current as of October 31, 2017. Electronic Arts assumes no obligation and does not intend to update these forward-looking statements. In addition, the preliminary financial results set forth in this release are estimates based on information currently available to Electronic Arts.

While Electronic Arts believes these estimates are meaningful, they could differ from the actual amounts that Electronic Arts ultimately reports in its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2017. Electronic Arts assumes no obligation and does not intend to update these estimates prior to filing its Form 10-Q for the fiscal quarter ended September 30, 2017.

About Electronic Arts

Electronic Arts (NASDAQ: EA) is a global leader in digital interactive entertainment. The Company develops and delivers games, content and online services for Internet-connected consoles, mobile devices and personal computers. EA has more than 300 million registered players around the world.

In fiscal year 2017, EA posted GAAP net revenue of $4.8 billion. Headquartered in Redwood City, California, EA is recognized for a portfolio of critically acclaimed, high-quality brands such as The Sims™, Madden NFL, EA SPORTS™ FIFA, Battlefield™, Need for Speed™, Dragon Age™ and Plants vs. Zombies™. More information about EA is available at www.ea.com/news.

Ultimate Team, EA SPORTS, Battlefield, Battlefield 1, The Sims, Need for Speed, Dragon Age, and Plants vs. Zombies are trademarks of Electronic Arts Inc. John Madden, NFL and FIFA are the property of their respective owners and used with permission.

 
ELECTRONIC ARTS INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statement of Operations
(in $ millions, except share per data)
       

Three Months Ended
September 30,

Six Months Ended
September 30,
2017 2016 2017 2016
Net revenue
Product 454 420 1,282 1,104
Service and other 505   478   1,126   1,065  
Total net revenue 959 898 2,408 2,169
Cost of revenue
Product 300 317 364 407
Service and other 89   84   179   173  
Total cost of revenue 389   401   543   580  
Gross profit 570 497 1,865 1,589
Operating expenses:
Research and development 331 291 656 585
Marketing and sales 160 143 281 271
General and administrative 118 111 223 219
Amortization of intangibles 2   1   3   3  
Total operating expenses 611   546   1,163   1,078  
Operating income (loss) (41 ) (49 ) 702 511
Interest and other income (expense), net 3   (3 ) 9   (11 )
Income (loss) before provision for (benefit from) income taxes (38 ) (52 ) 711 500
Provision for (benefit from) income taxes (16 ) (14 ) 89   98  
Net income (loss) (22 ) (38 ) 622   402  
Earnings (loss) per share
Basic (0.07 ) (0.13 ) 2.01 1.34
Diluted (0.07 ) (0.13 ) 1.99 1.28
Number of shares used in computation
Basic 309 301 309 301
Diluted 309 301 313 315
 

Results (in $ millions, except per share data)

The following table reports the variance of the actuals versus our guidance for the three months ended September 30, 2017 plus a comparison to the actuals for the three months ended September 30, 2016.

  Three Months Ended September 30,
2017
Guidance
  Variance   2017
Actuals
  2016
Actuals
Net revenue
Net revenue 955 4 959 898
GAAP-based financial data
Change in deferred net revenue (online-enabled games) 205 15 220 200
Cost of revenue
Cost of revenue 389 389 401
GAAP-based financial data
Acquisition-related expenses (12 )
Stock-based compensation (1 ) (1 ) (1 )
Operating expenses
Operating expenses 638 (27 ) 611 546
GAAP-based financial data
Acquisition-related expenses (2 ) (2 ) (1 )
Stock-based compensation (61 ) (61 ) (47 )
Loss before tax
Loss before tax (69 ) 31 (38 ) (52 )
GAAP-based financial data
Acquisition-related expenses 2 2 13
Change in deferred net revenue (online-enabled games) 205 15 220 200
Stock-based compensation 61 1 62 48
Tax rate used for management reporting 21 % 21 % 21 %
Loss per share
Basic (0.18 ) 0.11 (0.07 ) (0.13 )
Diluted (0.18 ) 0.11 (0.07 ) (0.13 )
Number of shares
Basic 310 (1 ) 309 301
Diluted 310 (1 ) 309 301
 
ELECTRONIC ARTS INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Balance Sheets
(in $ millions)
   
September 30, 2017 March 31, 2017 1
ASSETS
Current assets:
Cash and cash equivalents 2,067 2,565
Short-term investments 2,288 1,967
Receivables, net of allowances of $116 and $145, respectively 812 359
Other current assets 248   308  
Total current assets 5,415 5,199
Property and equipment, net 444 434
Goodwill 1,711 1,707
Acquisition-related intangibles, net 5 8
Deferred income taxes, net 248 286
Other assets 99   84  
TOTAL ASSETS 7,922   7,718  
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable 187 87
Accrued and other current liabilities 969 789
Deferred net revenue (online-enabled games) 1,116   1,539  
Total current liabilities 2,272 2,415
Senior notes, net 991 990
Income tax obligations 122 104
Deferred income taxes, net 1 1
Other liabilities 148   148  
Total liabilities 3,534 3,658
 
Stockholders’ equity:
Common stock 3 3
Additional paid-in capital 817 1,049
Retained earnings 3,641 3,027
Accumulated other comprehensive loss (73 ) (19 )
Total stockholders’ equity 4,388   4,060  
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY 7,922   7,718  
 

1Derived from audited consolidated financial statements.

 
ELECTRONIC ARTS INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Cash Flows
(in $ millions)
     
Three Months Ended
September 30,
  Six Months Ended
September 30,
2017

2016 2

2017

2016 2

OPERATING ACTIVITIES
Net income (loss) (22 ) (38 ) 622 402
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, amortization and accretion 32 45 63 91
Stock-based compensation 62 48 110 96
Change in assets and liabilities
Receivables, net (589 ) (481 ) (454 ) (493 )
Other assets (14 ) 31 66 37
Accounts payable 148 165 104 133
Accrued and other liabilities 216 181 100 109
Deferred income taxes, net (15 ) (23 ) 40 20
Deferred net revenue (online-enabled games) 234   194   (423 ) (391 )
Net cash provided by operating activities 52   122   228   4  
INVESTING ACTIVITIES
Capital expenditures (30 ) (29 ) (63 ) (69 )
Proceeds from maturities and sales of short-term investments 612 368 1,050 644
Purchase of short-term investments (702 ) (507 ) (1,395 ) (824 )
Net cash used in investing activities (120 ) (168 ) (408 ) (249 )
FINANCING ACTIVITIES
Payment of convertible notes (136 ) (163 )
Proceeds from issuance of common stock 27 27 57 31
Cash paid to taxing authorities for shares withheld from employees (10 ) (9 ) (105 ) (106 )
Repurchase and retirement of common stock (153 ) (127 ) (303 ) (256 )
Net cash used in financing activities (136 ) (245 ) (351 ) (494 )
Effect of foreign exchange on cash and cash equivalents 23   (5 ) 33   (8 )
Decrease in cash and cash equivalents (181 ) (296 ) (498 ) (747 )
Beginning cash and cash equivalents 2,248   2,042   2,565   2,493  
Ending cash and cash equivalents 2,067   1,746   2,067   1,746  
 

2Operating and financing cash flow figures for the three and six months ended September 30, 2016 have been recast to reflect the impact of ASU 2016-09 which EA adopted at the beginning of FY18.

 
ELECTRONIC ARTS INC. AND SUBSIDIARIES
Unaudited Supplemental Financial Information and Business Metrics
(in $ millions, except per share data)
           
Q2
FY17
Q3
FY17
Q4
FY17
Q1
FY18
Q2
FY18
YOY %
Change
Net revenue
Net revenue 898 1,149 1,527 1,449 959 7 %
GAAP-based financial data
Change in deferred net revenue (online-enabled games)3 200 921 (435 ) (674 ) 220
Gross profit
Gross profit 497 633 1,325 1,295 570 15 %
GAAP-based financial data
Acquisition-related expenses 12 18
Change in deferred net revenue (online-enabled games)3 200 921 (435 ) (674 ) 220
Stock-based compensation 1 1 1 1
Gross profit (as a % of net revenue) 55 % 55 % 87 % 89 % 59 %
Operating income (loss)
Operating income (loss) (49 ) (4 ) 717 743 (41 ) 16 %
GAAP-based financial data
Acquisition-related expenses 13 20 1 1 2
Change in deferred net revenue (online-enabled games)3 200 921 (435 ) (674 ) 220
Stock-based compensation 48 48 52 48 62
Operating income (loss) (as a % of net revenue) (5 %) 47 % 51 % (4 %)
Net income (loss)
Net income (loss) (38 ) (1 ) 566 644 (22 ) 42 %
GAAP-based financial data
Acquisition-related expenses 13 20 1 1 2
Change in deferred net revenue (online-enabled games)3 200 921 (435 ) (674 ) 220
Stock-based compensation 48 48 52 48 62
Tax rate used for management reporting 21 % 21 % 21 % 21 % 21 %
Net income (loss) (as a % of net revenue) (4 %) 37 % 44 % (2 %)
Diluted earnings (loss) per share (0.13 ) (0.00 ) 1.81 2.06 (0.07 ) 46 %
Number of diluted shares used in computation
Basic 301 303 308 309 309
Diluted 301 303 312 313 309
Anti-dilutive shares excluded for loss position4 13 10 3
 

3The difference between the balances of deferred net revenue (online-enabled games) in the unaudited condensed consolidated balance sheets does not necessarily equal the change in deferred net revenue (online-enabled games) in the unaudited condensed consolidated statements of cash flows due to the impact of unrecognized gains/losses on cash flow hedges.

 

4Diluted earnings per share reflects the potential dilution from common shares (calculated using the treasury stock method), issuable through stock-based compensation plans. When the company incurs a loss, shares issuable through stock-based compensation plans are excluded from the diluted loss per share calculation as inclusion would be anti-dilutive.

 
ELECTRONIC ARTS INC. AND SUBSIDIARIES
Unaudited Supplemental Financial Information and Business Metrics
(in $ millions)
           
Q2
FY17
Q3
FY17
Q4
FY17
Q1
FY18
Q2
FY18

YOY
%
Change

QUARTERLY NET REVENUE PRESENTATIONS
Net revenue by geography
North America 389 561 644 611 427 10 %
International 509   588   883   838   532   5 %
Total net revenue 898   1,149   1,527   1,449   959   7 %
North America 58 370 (198 ) (287 ) 59
International 142   551   (237 ) (387 ) 161  
Change in deferred net revenue (online-enabled games) 3 200   921   (435 ) (674 ) 220  
North America 43 % 49 % 42 % 42 % 45 %
International 57 % 51 % 58 % 58 % 55 %
Total net revenue % 100 % 100 % 100 % 100 % 100 %
 
Net revenue by composition
Full game downloads 94 169 259 209 123 31 %
Live services5 323 369 510 501 408 26 %
Mobile 149   147   165   169   158   6 %
Total digital 566   685   934   879   689   22 %
Packaged goods and other 332   464   593   570   270   (19 %)
Total net revenue 898   1,149   1,527   1,449   959   7 %
Full game downloads (1 ) 186 (67 ) (98 ) (4 )
Live services5 (68 ) 197 8 (81 ) (98 )
Mobile (11 ) 27   10   (19 ) (8 )
Total digital (80 ) 410   (49 ) (198 ) (110 )
Packaged goods and other 280   511   (386 ) (476 ) 330  
Change in deferred net revenue (online-enabled games) 3 200   921   (435 ) (674 ) 220  
Full game downloads 10 % 15 % 17 % 14 % 13 %
Live services 5 36 % 32 % 33 % 35 % 43 %
Mobile 17 % 13 % 11 % 12 % 16 %
Total digital 63 % 60 % 61 % 61 % 72 %
Packaged goods and other 37 % 40 % 39 % 39 % 28 %
Total net revenue % 100 % 100 % 100 % 100 % 100 %
 

3The difference between the balances of deferred net revenue (online-enabled games) in the unaudited condensed consolidated balance sheets does not necessarily equal the change in deferred net revenue (online-enabled games) in the unaudited condensed consolidated statements of cash flows due to the impact of unrecognized gains/losses on cash flow hedges.

 

5Live services includes net revenue previously presented as “Extra Content” and “Subscriptions, Advertising and Other” through Q4 FY17.

 
ELECTRONIC ARTS INC. AND SUBSIDIARIES
Unaudited Supplemental Financial Information and Business Metrics
(in $ millions)
           
Q2
FY17
Q3
FY17
Q4
FY17
Q1
FY18
Q2
FY18

YOY
%
Change

QUARTERLY NET REVENUE PRESENTATIONS
Net revenue by platform
Xbox One, PLAYSTATION 4, Switch 513 728 1,039 974 569 11 %
Other consoles 65   65   70   60   26   (60 %)
Total consoles 578 793 1,109 1,034 595 3 %
PC / Browser 158 190 246 240 196 24 %
Mobile 149 148 165 171 162 9 %
Other 13   18   7   4   6   (54 %)
Total net revenue 898   1,149   1,527   1,449   959   7 %
Xbox One, PLAYSTATION 4, Switch 177 762 (375 ) (548 ) 244
Other consoles 43   3   (40 ) (42 ) 14  
Total consoles 220 765 (415 ) (590 ) 258
PC / Browser (9 ) 127 (30 ) (61 ) (30 )
Mobile (11 ) 27 9 (20 ) (7 )
Other   2   1   (3 ) (1 )
Change in deferred net revenue (online-enabled games) 3 200   921   (435 ) (674 ) 220  
Xbox One, PLAYSTATION 4, Switch 57 % 63 % 68 % 67 % 59 %
Other consoles 7 % 6 % 5 % 4 % 3 %
Total consoles 64 % 69 % 73 % 71 % 62 %
PC / Browser 18 % 17 % 16 % 17 % 20 %
Mobile 17 % 13 % 11 % 12 % 17 %
Other 1 % 1 %     1 %
Total net revenue % 100 % 100 % 100 % 100 % 100 %
 

3The difference between the balances of deferred net revenue (online-enabled games) in the unaudited condensed consolidated balance sheets does not necessarily equal the change in deferred net revenue (online-enabled games) in the unaudited condensed consolidated statements of cash flows due to the impact of unrecognized gains/losses on cash flow hedges.

 
ELECTRONIC ARTS INC. AND SUBSIDIARIES
Unaudited Supplemental Financial Information and Business Metrics
(in $ millions)
           
Q2
FY17
Q3
FY17
Q4
FY17
Q1
FY18
Q2
FY18
YOY %
Change
CASH FLOW DATA
Operating cash flow6 122 1,137 437 176 52 (57 %)
Operating cash flow6 - TTM 1,323 1,555 1,578 1,872 1,802 36 %
Capital expenditures 29 25 29 33 30 3 %
Capital expenditures - TTM 120 124 123 116 117 (3 %)
Repurchase and retirement of common stock 127 127 125 150 153 20 %
DEPRECIATION
Depreciation expense 28 29 29 29 30 7 %
BALANCE SHEET DATA
Cash and cash equivalents 1,746 2,483 2,565 2,248 2,067
Short-term investments 1,520 1,736 1,967 2,222 2,288
Cash and cash equivalents, and short-term investments 3,266 4,219 4,532 4,470 4,355 33 %
Receivables, net 723 587 359 222 812 12 %
STOCK-BASED COMPENSATION
Cost of revenue 1 1 1 1
Research and development 27 27 28 28 36
Marketing and sales 8 8 8 7 9
General and administrative 12 13 15 12 16
Total stock-based compensation 48 48 52 48 62
 

6Operating cash flow has been recast to reflect the impact of ASU 2016-09 which EA adopted at the beginning of FY18.

Contact:

Electronic Arts Inc.
Chris Evenden, 650-628-0255
Vice President, Investor Relations
cevenden@ea.com
or
John Reseburg, 650-628-3601
Vice President, Corporate Communications
jreseburg@ea.com