Electronic Arts Inc. stock research
FY2024 Q3
Electronic Arts (EA) Gross Margin — Quarter Ended Dec 31, 2023
Revenue remained stable while cost of revenue increased, leading to a lower gross profit and a weakened gross margin compared to the previous quarter. Compared to the same quarter last year, revenue was unchanged, but a lower cost of revenue improved both gross profit and gross margin.
Gross margin takeaway
Quarter ended Dec 31, 2023 · FY2024 Q3
Revenue remained stable while cost of revenue increased, leading to a lower gross profit and a weakened gross margin compared to the previous quarter. Compared to the same quarter last year, revenue was unchanged, but a lower cost of revenue improved both gross profit and gross margin.
- The change in cost of revenue was the most significant factor affecting gross margin. Between the current quarter and the previous quarter, cost of revenue rose while revenue held steady, compressing the margin.
- Compared to the immediately preceding quarter, gross margin weakened as gross profit decreased relative to stable revenue. Compared to the same quarter one year earlier, gross margin improved, with gross profit rising on lower cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
72.8%
Gross profit
$1.4B
Revenue
$1.9B
Cost of revenue
$529.0M
Quarter-over-quarter change
-3.4 pts
Year-over-year change
+3.0 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% |
| Sep 30, 2023 | $1.9B | $1.5B | $456.0M | 76.2% |
| Dec 31, 2023 | $1.9B | $1.4B | $529.0M | 72.8% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2023
-3.4 pts
Year-over-year change
Dec 31, 2022
+3.0 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The change in cost of revenue was the most significant factor affecting gross margin. Between the current quarter and the previous quarter, cost of revenue rose while revenue held steady, compressing the margin.
Compared to the immediately preceding quarter, gross margin weakened as gross profit decreased relative to stable revenue. Compared to the same quarter one year earlier, gross margin improved, with gross profit rising on lower cost of revenue.
Monitor the trajectory of cost of revenue, as its change directly influenced margin movement this quarter.