Electronic Arts Inc. stock research
FY2023 Q1
Electronic Arts (EA) Gross Margin — Quarter Ended Jun 30, 2023
Revenue was stable versus the prior quarter and higher than a year earlier. Gross profit improved relative to both periods, driving gross margin higher sequentially and year-over-year, supported by a lower cost of revenue compared to the prior quarter.
Gross margin takeaway
Quarter ended Jun 30, 2023 · FY2023 Q1
Revenue was stable versus the prior quarter and higher than a year earlier. Gross profit improved relative to both periods, driving gross margin higher sequentially and year-over-year, supported by a lower cost of revenue compared to the prior quarter.
- Gross margin strengthened primarily because cost of revenue declined from the preceding quarter while revenue held steady, allowing gross profit to increase. This relative cost efficiency was the strongest observable driver of margin expansion.
- Compared to the immediately preceding quarter, gross margin improved. Versus the same quarter one year earlier, gross margin was also higher.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
80.9%
Gross profit
$1.6B
Revenue
$1.9B
Cost of revenue
$368.0M
Quarter-over-quarter change
+4.8 pts
Year-over-year change
+1.2 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Mar 31, 2023 | $1.9B | $1.4B | $448.0M | 76.1% |
| Jun 30, 2023 | $1.9B | $1.6B | $368.0M | 80.9% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2023
+4.8 pts
Year-over-year change
Jun 30, 2021
+1.2 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
Gross margin strengthened primarily because cost of revenue declined from the preceding quarter while revenue held steady, allowing gross profit to increase. This relative cost efficiency was the strongest observable driver of margin expansion.
Compared to the immediately preceding quarter, gross margin improved. Versus the same quarter one year earlier, gross margin was also higher.
Monitor the trajectory of cost of revenue relative to revenue, as the current period's sequential cost decline contributed significantly to margin expansion.