The multiplayer game Titanfall were among the titles that helped California digital game maker Electronic Arts Inc. (Nasdaq:EA) blow past analysts’ earnings estimates and beat revenue predictions when it released results of its first quarter July 22.
EA earlier this year ranked as British Columbia’s sixth largest technology company based on its 1,300 employees and much of its game development takes place in Burnaby.
Analysts had expected the company’s turnaround to be slower.
Last year the company lost US$121 million, or US$0.40 per share and analysts expected the company to stay in the red, losing US$0.04 per share in what is technically called non-GAAP net income. Instead, EA made a US$61 profit, or US$0.19 per share.
EA’s US$775 million in non-GAAP revenue in the quarter was similarly an upside surprise because it beat not only analysts’ estimates but also EA’s own projections.
EA had projected that it would generate US$700 million in non-GAAP revenue and analysts had expected US$709 million.
EA repurchased 1.4 million shares in the quarter, representing about US$50 million.
EA, along with plenty of other large companies, have recently been on a tear initiating stock buy-back programs. EA announced that the buying was part of a US$750 share repurchase program that it initiated in May.
Indeed, mammoth stock buy-backs from some of the largest companies in the world are putting 2014 on track to potentially be the biggest-ever year for public companies to repurchase their own stock.
Apple Corp. (AAPL:Nasdaq), for example, set a record for the biggest quarterly stock buyback in history by repurchasing nearly US$18 billion worth of its shares in the first three months of 2014. Other U.S. corporate giants on the stock buyback bandwagon include IBM (IBM:NYSE) repurchasing about US$8 billion in the first quarter of 2014 and ExxonMobil (XOM:NYSE) buying back US$4 billion in the same time frame.
B.C. companies making similar moves include the largest company in B.C., Telus Corp. (T:TSX).
Telus has long been a supporter of returning money to shareholders both in the form of buying back stock and distributing dividends. In the past decade, Telus has bought back more than $4 billion of its shares while also shelling out about $6 billion in dividends.
The telecom led B.C. companies by buying back $159 million worth of stock in the first quarter of 2014 as well as another $43 million in April, according to a filing in May.
