5. Electronic Arts Inc. (NASDAQ:EA)
Number of Hedge Fund Holders: 40
Electronic Arts Inc. (NASDAQ:EA) is a prominent American video game company and a major player in the interactive entertainment industry. The company develops and delivers games, content, and online services for various platforms, including consoles, PCs, and mobile devices. The company boasts a portfolio of highly acclaimed franchises such as The Sims, Madden NFL, EA SPORTS FIFA, Battlefield, Dragon Age, and Plants vs. Zombies.
On September 17, Electronic Arts Inc. (NASDAQ:EA) hosted its Investor Day event, outlining its long-term growth strategy focused on engaging large online communities and creating blockbuster interactive experiences. The company emphasized the role of AI in enhancing efficiency and transformation within its operations. EA is optimistic about sustained growth in its EA SPORTS brand. The company announced plans to introduce a new Battlefield experience with community testing set for early 2025. EA is investing in The Sims platform, with expectations of more than doubling its annual net bookings over the next five years. The company also announced a collaboration with Amazon MGM studios on a movie based on The Sims.
Management outlined plans to explore new business opportunities beyond gaming through a socially-driven EA SPORTS app, with sports content, live sports data, interactivity and gaming centered on global football. These initiatives position EA as a strong contender for future growth in the gaming and entertainment industry.
Electronic Arts Inc. (NASDAQ:EA) reported strong results for Q1 FY25, with net bookings reaching $1.262 billion, surpassing the high end of the guidance range of $1.25 billion. This growth was driven by strong performance across Madden NFL 24, FC Online, and FC Mobile. During the quarter, EA SPORTS FC attracted millions of new fans through real-world tournaments and events. The company also revealed Dragon Age: The Veilguard gameplay, which received millions of views and trended no. 1 on YouTube Gaming.
Additionally, after the quarter ended, EA SPORTS College Football 25 welcomed 5 million unique players in its first week, highlighting the franchise’s appeal.
The company’s net revenue for its fiscal first quarter of 2025 was $1.66 billion, with a healthy cash flow from operations amounting to $120 million. Electronic Arts Inc. (NASDAQ:EA) is actively returning value to shareholders by repurchasing shares and paying dividends. During Q1 2025, the company repurchased 2.8 million shares for $375 million, bringing the total for the trailing twelve months to 10.2 million shares for $1.35 billion. The company also declared a quarterly cash dividend of $0.19 per share.
According to Insider Monkey’s Q2 database of over 900 hedge funds, 40 hedge funds held stakes in Electronic Arts Inc. (NASDAQ:EA). As of June 30, D. E. Shaw holds 1.39 million shares of the company, valued at $193.72 million, making it EA’s most prominent shareholder.
The company has managed to grow its net income at a compound annual growth rate (CAGR) of 25% over the past ten years. Electronic Arts Inc. (NASDAQ:EA) ranks among the top 5 on our list of the best gaming stocks to buy.
