• EA Earnings Call Reiterates Summer 2024 Release for EA CFB

    During Tuesday's Third Quarter Fiscal Year 2024 Earnings Conference Call, Electronic Arts reiterated that EA SPORTS College Football will be released in 'Summer 2024' via comments from both CEO Andrew Wilson and CFO Stuart Canfield.

    The last release of game information came in November 2022 via an ESPN.com article that contained an interview and several work-in-progress screenshots of Michigan Stadium and Brutus Buckeye. The long gap in official communication from EA SPORTS has led to growing concern within the community that the game may be delayed. These statements should help to alleviate such concerns.

    Wilson acknowledged that there is "an incredible amount of pent-up demand" for the title and that he believes EA CFB will be "both complementary in gameplay but overall additive to the [Madden NFL] ecosystem" as EA works to expand the football community in the US and internationally.

    Other noteworthy statements directly from EA included:
    - "In calendar 2023, Madden NFL was the best-selling sports game in North America" and "In Q3, net bookings grew and engagement with Ultimate Team increased 19%."
    - "Live services net bookings grew to a record $1.71 billion in Q3, up 3% year-over-year."
    - "On a trailing 12-month basis, total net bookings was up 8% year-over-year, with live services contributing $5.6 billion, or 73%."

    Continue on to read all of the pertinent statements from yesterday's earnings call mentioning EA SPORTS College Football.

    Chairman & CEO Andrew Wilson's Prepared (Opening) Remarks:

    "Turning to FY 2025, we will deliver even more excitement and entertainment through an expanded portfolio of connected ecosystems. Industry leader EA SPORTS will launch a strong core slate of titles and always-on live services to grow our sports business as a global community and drive value, year after year.

    "Our journey building FC, the world's largest interactive platform for global football fans, will continue with accelerated gameplay innovation, more social connection, and new brand collaborations to deliver even more value for players. Our teams, working with an incredible roster of partners, are just getting started with FC. We are well-positioned to grow this platform as a cultural phenomenon.

    "The momentum in Madden NFL will continue with events and experiences tied to the biggest moments in the sport, alongside deeper investments in this ecosystem, including leaps in gameplay and deeper fan immersion. In addition to the meaningful advancements in Madden, we are bringing back fan favorite EA SPORTS College Football for the first time in over a decade."

    The following are questions fielded by Wilson and Canfield from analysts followed by excerpts in their answers where EA SPORTS College Football was mentioned.

    Matthew Cost, Analyst, Morgan Stanley & Co. LLC

    Question: "Question two, just beyond College Football, as we get a little bit closer to release, can you do anything to help us scale the opportunity for everyone and sort of think through what is incremental versus what might come from the existing Madden customer base? Thank you."

    Wilson: "And on College Football, our expectation is it will be additive. As we think about Madden, Madden is performing incredibly well this year. As we said in our prepared remarks, the biggest game biggest sports game in calendar year 2023 was the increased engagement in the game and increased monetization in Ultimate Team as part of that. The team is continuing to invest meaningfully into the modes of Madden and expansion of Madden as a product.

    And certainly, as we look at the NFL broadly and the fan base continue to grow and the incredible season we're having this year, our expectation is that we will invest behind Madden and grow Madden and that what College Football represents as a game that's being 10 years in the waiting for our fans is that there's an incredible amount of pent-up demand. And we expect that to be additive to the ecosystem.

    And over the broad course of time, the way our team thinks about this is how do we really expand the football community in this country and internationally through a combination of both Madden and College that we think will be both complementary in gameplay but overall additive to the ecosystem.

    Christopher Schoell, Analyst, UBS Securities LLC

    Schoell: "Thanks for taking my questions. You mentioned in the press release that you're prioritizing investment in the largest opportunities for multi-year growth. I appreciate you're looking to drive growth across the portfolio, but which franchises in particular do you see the most incremental opportunity as you look out into fiscal 2025 and beyond?"

    Wilson: "Yes. Great question. Thank you. First and foremost, I would go back to, as a core entertainment company, it is always important that we are developing and investing in new IP to grow the future pipeline opportunity, that optionality that Stuart referred to earlier. And we have the strongest pipeline I think we've had in many, many years as we go into those out-years in terms of both our core IP and new IP.

    "If we look at the trailing 12 months, both in terms of engagement and monetization, what we do see, however, is that the biggest games are these games that really entertain and engage massive online communities. And these are existing franchises that either evolve on a month-by-month cadence or evolve with annual releases plus live services.

    "And so as we think about the foundation of growth for our business, we think about FC. Again, this was the first year of FC branding. What we've spoken about in the past few quarters is having that FC brand and partnering more closely with the core leagues in territory gives us more growth opportunities than we believe we've ever had before. It is building around Madden, NFL, and expanding the broader College Football base, but it's also investing in The Sims and in Apex and in Battlefield and ultimately some of those as we go down through the next coming years."

    Michael Hickey, Analyst, The Benchmark Co. LLC

    Hickey: "The second one is sort of looks like 2025 is not called an investment year, but most of the growth here is driven by your core games and live services. But you look at your longer-term pipeline, you think about Battlefield, Mass Effect, Star Wars, obviously you've been great in the action genre. I think you're still developing a shooter from Respawn as well. [indiscernible] (00:41:28) free-to-play. Maybe user-generated content. Then licensed property is like Iron Man, Black Panther. I mean, all of those seem feasible by fiscal 2027. So just sort of curious, and I know you kind of talked about your longer-term growth opportunity. Near term you focus on levers, but do you think you're sort of in a position here in the next few years to sort of accelerate your top line growth just given how substantial your pipeline appears to be? Thanks, guys."

    Canfield: "And Mike, just to kind of tackle your second question, let's take 2025 first a second, and I'll build it back into the longer-term answer I gave before and in prepared remarks on as well.

    So first on 2025. So I think the key here is we expect growth in our core business. We're 73% live service and obviously have a consistent full game sports release slate, plus we've talked to College coming in the summer next year in 2024.

    Second, we do have a lighter release slate which obviously comps to a Star Wars launch and a more expansive sports slate where we saw eight titles released this year. And we've called out also that Battlefield is not in our FY 2025 outlook.

    Third, we continue to drive leverage. And I'll just point you to your question around sort of an investment year. You can see sort of by the underlying profitability range that we are still getting scale and leverage by virtue of efficiencies in the business but also continue to resource and reallocate against some of our bigger growth opportunities."


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