FIFA Remains EA’s Bread and Butter

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Electronic Arts

In 2016, the FIFA franchise accounted for nearly 40% of Electronic Arts’ (NASDAQ: EA) revenue, according to our estimates. The company sold close to 15.5 million units of FIFA, with each unit earning nearly $121. This figure comes not only from the initial game sales, but also from services such as in-game purchases and the ultimate team feature. No other game that EA offers has comparable numbers, demonstrating the value of the FIFA franchise. Such dependence on FIFA is both a boon and a bane for EA. On one hand, its consistent popularity allows for a steady growth stream, something which can be a challenge for gaming companies. On the other hand, that much dependence on one product can be a risk, as the company’s market value could be impacted in the event of waning interest from gamers. While there is no doubt that EA needs to keep pumping out interesting titles in order to diversify its revenue streams, we believe that FIFA still has significant growth potential and will continue to be EA’s bread and butter for the foreseeable future.

Our current price estimate for Electronic Arts stands at $120, which is about in line with the market price.


Going forward, we expect FIFA‘s revenue growth to be even more consistent as in-game transactions and subscription models become a bigger part of the gaming ecosystem as a whole. EA’s ultimate team feature in FIFA is already generating nearly $800 million a year in in-game revenue. Incremental growth will also come from China, where soccer is gaining popularity.  China’s 50-point plan to turn the country into an $813 billion sports industry, with a special focus on developing soccer, could boost FIFA sales significantly.

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By 2021, we expect FIFA’s annual unit sales to exceed 20 million, and bring in more than $3 billion annually for EA. Much of this will be driven by in-game purchases and other services. So while dependence on one title does present some risks, FIFA’s massive and growing popularity will allow it to continue to drive growth for EA.

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