Aureus
AExcellent

Electronic Arts Inc.(EA)

A

Financial data as of Mar 31, 2025Improving · Communication Services

FCF Margin16.3%Free Cash Flow / Revenue
Cash Conversion185.5%Operating CF / Net Income
Free Cash Flow$1.9B
Revenue$7.5B
Net Cash$185.0MCash exceeds debt
Debt / FCF1.6xManageable debt load
Current Ratio0.95Tight short-term liquidity
YoY FCF Growth+65.5%3 of 5 quarters positive

How This Grade Was Calculated

Base grade from FCF margin, adjusted by financial health factors

BaseA
→
+0.5Healthy FCF margin with manageable debt (16.3%, 1.6x)
→
-0.5Current ratio below 1.0 (0.95) (reduced — strong FCF covers short-term obligations)
→
+1Strong YoY FCF growth (65.5% YoY)
→
-0.5Highly volatile FCF (consistency: 1.30)
→
+1Net cash position with strong FCF margin
→
+1Very low debt-to-FCF ratio (1.6x)
→
FinalA

Analysis Summary

Strengths

  • Strong FCF margin (16.3%)
  • Excellent cash conversion (185%)
  • Net cash position ($0.2B)
  • Very low debt relative to cash flow (1.6x)
  • Strong YoY FCF growth (+65.5%)

Concerns

  • Current ratio below 1.0 — tight short-term liquidity
  • Only 3 positive FCF quarters recently
  • Highly volatile quarterly FCF
SBC-adjusted FCF used — $0.6B stock-based compensation (35% of reported FCF) subtracted

Financial Breakdown

Key financials compared side by side

Margin Composition

FCF Margin16.3%
Net Margin15.0%
Operating CF Margin27.9%
CapEx Ratio3.0%

Balance Sheet Health

Debt, liquidity, and leverage snapshot

Net Cash$185.0MCash exceeds debt
Debt / FCF1.6xManageable debt load
Current Ratio0.95Tight liquidity
Debt / Equity0.31Low leverage

Quarterly FCF Trend

+65.5% YoYImproving (+65.5%)

Free cash flow per quarter

Sector Comparison — Communication Services

FCF Margin ranked against sector peers

View all →

Detailed Metrics

Company NameElectronic Arts Inc.
SectorCommunication Services
Free Cash Flow$1.9B
Revenue$7.5B
Net Income$1.1B
Operating Cash Flow$2.1B
Capital Expenditure$221.0M
FCF Margin16.3%
Cash Conversion Rate185.5%
Net Margin15.0%
Total Debt$2.0B
Total Cash$2.1B
Net Cash$185.0M
Current Ratio0.95
Debt / Equity0.31
Debt / FCF1.6x
YoY FCF Growth+65.5%
Positive Quarters3 of 5
Trend DirectionImproving
Report DateMar 31, 2025
GradeA
Data SourceYahoo Finance

Related Research

All research →
Sector Report4 min read

Communication Services: Eight A-Grades Hiding Three Failures

Half the sector earns A-grades. The other half is bleeding cash or barely breaking even.

Feb 13, 2026
MTCHEAMETANFLX+14
Sector Report4 min read

Consumer Discretionary: Eleven A-Grades Built on Tourism

The sector looks healthy until you see what's propping it up.

Feb 13, 2026
ABNBBKNGMCDEA+11
Sector Report5 min read

Consumer Discretionary: A Sector Split in Half

Eleven A-grades at the top, nine F-grades at the bottom. The consumer discretionary sector isn't struggling. It's bifurcating.

Feb 13, 2026
ABNBBKNGMCDEA+8