Electronic Arts' (EA) growth outlook has turned ambiguous amid a surprise downturn in EA Sports FC 25 booking demand, BofA Securities said Thursday in a note.
"We are no longer confident that EA can gain enough share of player engagement & spend to drive meaningful growth in a struggling PC/Console game industry," the firm said as it downgraded the stock's rating to neutral from buy.
BofA slashed its price target for Electronic Arts to $130 from $170. Shares of the company were down more than 17% in recent trading.
The BofA downgrade follows Electronic Art's cutting its 2025 outlook for live services net bookings. The company said late Wednesday that it now expects a "mid-single-digit" decline, instead of its prior projection of a "mid-single-digit" growth, in live services net bookings for 2025, with Global Football accounting for the majority of the change.
BofA now expects 2025 and 2026 earnings per share of $6.84 and $6.78, respectively, for Electronic Arts, compared with its prior estimates of $7.86 and $8.65.
The firm hopes to get further clarity on the cause of FC's weakness during the Q3 earnings call on Feb. 4.
Price: 117.26, Change: -25.09, Percent Change: -17.63
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