Since its initiation in 2002, the "Battlefield" franchise continues to be Electronic Arts Inc. EA’s most popular and highest-grossing production. The most recent release of "Battlefield 1" in 2017 attracted over 19 million participants.
What Happened
The highly anticipated release of the newest first-person shooter, "Battlefield V," was expected for Oct. 18. On Thursday, EA announced the game's delay and a revised earnings outlook.
"We believe we've got one of the best 'Battlefield' games ever coming in 'Battlefield V,'" EA Chief Studios Officer Laura Miele said in the press release.
"Tens of thousands of players have been hands-on with the game so far, and we've been honored to receive best multiplayer awards at E3 and Gamescom. We've had valuable feedback from our community, and we're going to take the time to make some final adjustments and deliver a great experience for our fans."
Why It’s Important
Considering the overwhelming feedback surrounding the game release — combined with the impact of foreign exchange rates and an updated mobile forecast — EA announced a $350-million revision to its net bookings outlook for 2019.
"We're updating our fiscal year guidance to reflect the updated launch date for 'Battlefield V,' the ongoing impact of foreign exchange rate changes and our current outlook for our mobile business," COO and CFO Blake Jorgensen said in the press release.
KeyBanc Capital Markets updated its EA estimates per the company’s announcement.
“Of the $350-million impact, $115 million is related to FX headwinds, which are mostly neutral to EPS given EA’s hedging program," analyst Evan Wingren said in a Thursday note. The remaining $235-million hit can be attributed to the following, the analyst said:
- Lower units as a function of timing ($100 million).
- Lower MTX as a function of timing and lower subscriptions ($60 million).
- Lower mobile revenue on general mobile weakness and the potential timing change of new games ($50-$75 million).
What’s Next
'Battlefield V' will now be released Nov. 20, enabling the company to “deliver the best possible experience for gamers," according to EA.
Wingren said he considers this delay positive for competitors like Activision Blizzard, Inc. ATVI and Take-Two Interactive Software, Inc. TTWO, in light of the companies’ planned October launches of "Call of Duty: Black Ops IIII" and "Red Dead Redemption 2."
EA shares dropped over 10 percent following the announcement.
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