EA Starts Fiscal 2023 With Slight Guidance Beat; Apex Mobile Will Help Expand Player Base

EA kicked off fiscal 2023 on a slightly better-than-expected note, with bookings and adjusted operating income just beating guidance. However, management merely reiterated its fiscal 2023 guidance, given currency headwinds and a potential second-half slowdown in mobile. Despite the better-than-expected results, we believe that Battlefield 2042 remains a drag on top-line growth, an issue that we expect to persist through the year. While management noted the strength of sports and racing games as well as the impressive launch of Apex Legends Mobile on the earnings call, Battlefield was not discussed at all, despite its status as the one of the firm’s premier franchises. We are maintaining our $142 fair value estimate.