EA’s Dominance in Live Service Revenue Sets Stage for Saudi Merger Completion
Electronic Arts (EA) has just published its last financial report as a publicly-traded company, and the numbers are nothing short of impressive. With a take-private merger with an investor consortium led by Saudi Arabia’s sovereign wealth fund expected to conclude later today, EA’s live service revenue is at the forefront of its success story. The company’s net revenue has increased by 19% to $1.98 billion during the first quarter ended June 30, 2026, while operating income has skyrocketed by 89% year-on-year to a whopping $513 million.
At the heart of this growth lies EA’s live service catalog, which saw revenue increase by 7% year-on-year to $1.47 billion. This is largely due to increased sales of extra content within games like Battlefield 6 and EA Sports FC. The impact is even more pronounced when looking at net bookings, which rose by 4% year-on-year to $1.39 billion. These numbers are primarily driven by sales related to EA Sports FC, Apex Legends, and American football series Madden NFL and EA Sports College Football.
But what’s perhaps most telling about EA’s financials is the shift towards digital sales. The company notes that the vast majority of its full-game revenue has been derived from digital sales on platforms like Xbox and PlayStation over the past three fiscal years. This trend has led some to speculate that Sony is preparing to move away from physical releases in 2028, a move that would likely have significant implications for the gaming industry as a whole.
EA’s shift towards live service revenue and digital sales has also led to an expansion of its gross margin. The company explains that digital sales combined with increased live service revenue result in lower costs associated with selling titles digitally compared to physical releases through retail channels.
While EA’s financials may seem positive, the company continues to make layoffs, including last year’s elimination of roles at Skate developer Full Circle and its Battlefield division. This raises questions about the sustainability of EA’s business model and whether it can maintain this level of success in the long term.
As EA completes its take-private merger with the Saudi Arabian sovereign wealth fund later today, one thing is clear: the company’s focus on live service revenue and digital sales has set it up for continued growth. Whether this trend will continue remains to be seen, but one thing is certain – the gaming industry will be watching closely as EA embarks on its new chapter.
The future of VR/XR is inextricably linked with the evolution of the gaming industry. As live service revenue and digital sales continue to dominate, we can expect to see even more innovative approaches to game development and distribution. With the rise of cloud gaming and streaming services, the lines between PC, console, and mobile are becoming increasingly blurred. EA’s success story is just one chapter in this ongoing narrative – as VR/XR technology continues to advance, we can expect to see new forms of immersive entertainment that blur the boundaries between games, movies, and even reality itself.
Source: Game Developer XR — 2026-08-04