By The Associated Press
NEW YORK, N.Y. – Video game publisher Electronic Arts Inc. says its quarterly net income rose fivefold on strong revenue from online games and titles such as “Crysis 2” and “Dragon Age 2,” sending shares higher in after-hours trading.
Investors seemed to excuse a lower-than expected outlook for the current quarter in favor of strong results from EA’s digital business, which includes games on Facebook, the iPhone and other gadgets, as well as downloadable add-on content for games sold as discs. The company is working to expand this side of its business as demand for expensive, packaged video game discs slows and more people flock to mobile gadgets and social networks to play games.
Electronic Arts said Wednesday that it earned $151 million, or 45 cents per share, in the January-March period. That’s up from $30 million, or 9 cents per share, in the same period a year earlier.
The company’s adjusted profit of 25 cents per share handily surpassed Wall Street’s expectations. Revenue grew 11 percent to $1.09 billion from $979 million in the fiscal fourth quarter.
EA’s adjusted revenue, which accounts for deferred revenue from games with online components, was $995 million, up from $850 million a year earlier. On this basis, analysts were expecting revenue of $922.6 million.
The company said its digital revenue grew sharply, to $211 million from $144 million a year earlier. On an adjusted basis, digital revenue was up 72 percent for the quarter to $268 million.
“I’m particularly proud of EA’s rapid growth and scale in digital, and the growth rate almost doubled that of the digital sector overall. We did it in a way no other competitor can,” said CEO John Riccitiello in a conference call with analysts.
Eric Brown, EA’s chief financial officer, said the company continues to weigh more of its business to digital. In fiscal 2011, 22 percent of the company’s business came from the non-packaged side.
For the current quarter, EA forecast an adjusted loss between 49 cents and 44 cents per share. That compares with analyst expectations of a loss of 34 cents per share. The company forecast adjusted revenue of $460 million to $500 million per share, below the $557.1 million that analysts are expecting.
For the full fiscal year, Redwood City, Calif.-based EA forecast adjusted earnings of 70 cents to 90 cents per share, compared with analysts’ average estimate of 85 cents.
Shares of EA, which is based in Redwood City, Calif., rose 53 cents, or 2.7 percent, to $20.66 in after-hours trading. The stock had closed down 24 cents at $19.92.
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