Electronic Arts said sales and profits dropped in the most recent quarter, ahead of a go-private deal that analysts expect will lead the company to cut costs.
The Redwood, California-based video game company recorded a 9.2% year-over-year decline in net revenue in the second fiscal quarter of 2026 to $1.84 billion. Net income also fell 53% from last year to $137 million. That amounted to 54 cents a share. EA attributed this to the highly anticipated sports title releases like College Football 25 from the previous year.
One of the largest game publishers now faces a pivotal moment since it was founded four decades ago, after recently announced plans to go private in a leveraged buyout estimated to be valued at $55 billion and to close in early 2027. The company has set the stage for a potential change of focus under new ownership, while it has also attempted to keep the stability it has become known for.
The company said Battlefield 6 and skate. were two of the most successful launches this quarter. The core offerings of sports franchises and shooter games like Apex Legends and Battlefield continued to show resilience. Gaming consoles were also one of the company’s top earners, bringing in $1.2 billion.
Apex Legends has remained one of EA’s top earners.
The future path of EA could change once it is taken private by an investor consortium that includes the Public Investment Fund of Saudi Arabia and Affinity Partners. EA is likely to cut costs as part of the transaction, according to analysts, which is set to come with $20 billion of debt.
“The bottom line is they’re going to cut some studios, no matter what,” said Martin Szumski, an associate equity analyst at Morningstar. “They’re mainly just going to do it because they have to pay down this debt over time.”
EA’s stock plummeted after the release. However, it rebounded on Election Tuesday to the plateau of the $200 range it has been trading in since the takeover announcement.
This is in line with a Baird report by Colin Sebastian, a senior research analyst, who noted in his latest report that EA shares will “range-bound,” meaning that the stock will continue to trade near the $210 per share offer.
Electronic Arts will no longer provide forward-looking guidance or earnings calls for the third quarter onward because of the consortium’s purchase of the gaming giant, a move that was expected, according to Szumski.
This quarter was “mediocre” but largely in line with expectations, according to Szumski. The release of the highly anticipated EA Sports College Football 25 in the second quarter of fiscal 2025 accounted for the 13% drop year over year in net bookings.
EA Sports College Football 25 was highly anticipated by fans.
This was the first entry to the series in a decade after an antitrust lawsuit between Ed O’Bannon, a former University of California, Los Angeles basketball player and the National Collegiate Athletic Association for using players’ name, image and likeness rights without compensation. EA Sports was named as an example of this, resulting in this case leading to an indictment and the company being forced to pay to use the likenesses of players. In addition, because of the association pulling their licenses, EA was forced to stop making the series. This lasted until the company announced a brand-new series in 2021, following the acquisition of new licenses.
“We love the energy, tradition and pageantry of college football and I am beyond thrilled to say we are back in development, said Cam Weber, EA SPORTS EVP and GM in a press release announcing the series return.
EA’s live service games made up 66% of the company’s total revenue totaled at $1.2 billion.
EA Sports Madden NFL 26 brought players back to the franchise, with the game delivering net bookings this quarter from last year. Apex Legends, on the other hand, had double-digit sales growth. The recently released EA Sports FC 26 is also performing better than last year’s release compared in the same time frame.
“It’s always been the video game company under our coverage that we have liked the best, simply because the huge sports portfolio it has puts out new games on an annual basis,” said Szumski. “So it’s much more steady in terms of revenue.”