Aureus
AExcellent

Electronic Arts Inc.(EA)

A

Financial data as of Mar 31, 2026Improving · Communication Services

FCF Margin22.1%Free Cash Flow / Revenue
Cash Conversion287.8%Operating CF / Net Income
Free Cash Flow$2.3B
Revenue$7.5B
Net Cash$1.3BCash exceeds debt
Debt / FCF0.9xManageable debt load
Current Ratio1.05Adequate short-term liquidity
YoY FCF Growth+10.2%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 (22.1%, 0.9x)
→
+0.5Modest YoY FCF growth (10.2% YoY)
→
-0.5Highly volatile FCF (consistency: 1.60)
→
+1Net cash position with strong FCF margin
→
+1Very low debt-to-FCF ratio (0.9x)
→
FinalA

Analysis Summary

Strengths

  • Exceptional FCF margin (22.1%)
  • Excellent cash conversion (288%)
  • Net cash position ($1.3B)
  • Very low debt relative to cash flow (0.9x)
  • FCF trend is improving

Concerns

  • Only 3 positive FCF quarters recently
  • Highly volatile quarterly FCF
SBC-adjusted FCF used — $0.7B stock-based compensation (28% of reported FCF) subtracted

Financial Breakdown

Key financials compared side by side

Margin Composition

FCF Margin22.1%
Net Margin11.8%
Operating CF Margin33.9%
CapEx Ratio3.1%

Balance Sheet Health

Debt, liquidity, and leverage snapshot

Net Cash$1.3BCash exceeds debt
Debt / FCF0.9xManageable debt load
Current Ratio1.05Adequate liquidity
Debt / Equity0.23Low leverage

Quarterly FCF Trend

+10.2% YoYImproving (+10.2%)

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$2.3B
Revenue$7.5B
Net Income$887.0M
Operating Cash Flow$2.6B
Capital Expenditure$230.0M
FCF Margin22.1%
Cash Conversion Rate287.8%
Net Margin11.8%
Total Debt$1.5B
Total Cash$2.9B
Net Cash$1.3B
Current Ratio1.05
Debt / Equity0.23
Debt / FCF0.9x
YoY FCF Growth+10.2%
Positive Quarters3 of 5
Trend DirectionImproving
Report DateMar 31, 2026
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