What happened
Shares of Electronic Arts (EA -0.52%) fell 9% on Wednesday after the video game maker delivered lackluster financial results that were weighed down by game delays and production challenges.
So what
EA's revenue rose 5% year over year to nearly $1.9 billion in its third fiscal quarter ended Dec. 31. The gains were driven in part by strong sales of its popular soccer game FIFA 23, which is on track to be the best-selling title in franchise history.
Notably, EA's player network topped 650 million by the end of December.
"In Q3, EA delivered high-quality experiences, driving record engagement across some of our biggest franchises and growing our player network," CEO Andrew Wilson said in a press release.
Still, EA's bookings -- a key sales metric for video game publishers -- fell short of investors' expectations. The company reported net bookings of $2.3 billion. Wall Street had projected bookings of nearly $2.5 billion.
"While our teams delivered for our players, the current macro environment impacted Q3 results," Wilson said.
Now what
EA's guidance also disappointed investors. Management guided for fiscal Q4 revenue of $1.7 billion to $1.8 billion, which was below analysts' estimates of $2.1 billion. The shortfall is largely due to EA's decision to delay the highly anticipated release of Star Wars Jedi: Survivor by six weeks until April 28.
Worse still, EA said it was shutting down the mobile version of Apex Legends and ceasing development of a mobile game for its popular Battlefield franchise, citing quality concerns.
"As market uncertainty mounted during the quarter, we took measures to protect underlying profitability," Chief Financial Officer Chris Suh said. "We are prioritizing the player experience, directing investment to where it can have the most positive impact for our players and on growth."
