Electronic Arts is promising investors high growth rates in players, sales and margins – with artificial intelligence expected to help with this.
Electronic Arts is currently valued at the equivalent of 34 billion euros on the NASDAQ – no other classic publisher is worth as much on the stock exchange as the US company, which EA Sports FC, Battlefield, Madden NFL and Apex Legends generated an annual turnover of almost 7 billion euros. The share price is close to its all-time high.
The company employs 13,700 people in 20 countries – in the German branch in Cologne, more than 130 employees are involved in the development of EA Sports FC involved.
At this year's Investor Day in New York on Tuesday, Electronic Arts is swearing analysts and shareholders to the course it has chosen: EA has set itself the goal of above-average growth by the 2027 financial year. At the same time, the forecasts for the current year are confirmed: With EA Sports FC 25 (released on September 27th) is a sure-fire revenue generator waiting in the wings.
Looking at the future EA strategy is exciting because it can be used to derive trends for the overall market – even if not all of the concepts that were announced with great fanfare in the past were actually implemented (keywords: blockchain, crypto, NFT).
The most exciting findings from the EA Investor Day, which was attended by the entire top management including CEO Andrew Wilson, Laura Miele (EA Entertainment) and Cam Weber (EA Sports):
- Much of the presentation revolved around user-generated content (UGC) – content created by players and content creators, as is the case with Roblox and Minecraft works perfectly. The concept is not new, but is experiencing a renaissance.
- A crucial role in this context is – of course – the topic of AI, or artificial intelligence. Game content should be able to be produced more efficiently, more quickly and on a larger scale, from individual characters to entire stadiums, game worlds and cutscenes. It is obvious that this will also lead to cost reductions in the future: just in February, the company cut almost 700 jobs.
- In the EA Entertainment division, Electronic Arts focuses on a triad of action role-playing games (Dragon Age: The Veilguard), online shooter (Battlefield, Apex Legends) and simulations such as the Sims.
- Especially on the SimsThere are extremely high expectations for the Sims universe – sales are expected to double within the next five years. AI is also expected to help with the creation of characters, clothes and furnishings. A real 'Sims hub' is expected to bring together and connect all platforms. At the same time, new competition is looming, for example from Krafton. inZOIIn collaboration with Amazon MGM Studios and Margot Robbie's LuckyChap Entertainment, a Sims-Film.
- The next Battlefield returns to the modern age and is an XXL co-production of the EA studios DICE, Criterion, Motive and Ripple Effect. The community beta program is scheduled to start in early 2025.
- In the sports and racing game segment – i.e. EA Sports FC, NHL, F1, College Football and Madden NFL – only a third of the revenue comes from full-price games. The real lever is and remains 'live services', i.e. in-game purchases. EU consumer associations are critical of the monetization methods used and are calling on the EU Commission to take action.
- A new EA Sports-App will not only combine social media mechanics, live sports data and games content, but will also open up new revenue streams with regard to sponsorship and advertising.
The announcements were subsequently received moderately well on the stock exchange: The EA share price fell by around 2 percent in the morning.
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