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ELECTRONIC ARTS ANNOUNCES 53-PERCENT INCREASE IN NET INCOME FOR ITS FIRST QUARTER

 SAN MATEO, Calif., July 21 /PRNewswire/ -- Electronic Arts (NASDAQ: ERTS) today announced its first quarter, fiscal year 1994 operating results. Net income for the first quarter ended June 30, 1993, was $7,318,000, up over 53 percent from $4,754,000 earned in the quarter ended June 30, 1992. Earnings per share for the first quarter of fiscal year 1994 were 15 cents compared to 10 cents earned in the first quarter of the last fiscal year, an increase of 50 percent.
 Revenues for the quarter ended June 30, 1993, were $79,500,000, compared to $50,099,000 in the first quarter of the prior fiscal year, an increase of over 58 percent.
 Revenue growth in the June quarter was achieved primarily from the sales of products for the Sega Genesis(TM), the SNES(TM) and for the IBM(TM) PC and compatibles. In addition, during the quarter the company released a total of 12 new products compared to 11 products released in the June quarter last year. The 12 new products shipped this quarter included three for the Sega Genesis, one for the SNES, seven for the IBM PC, and one for the Amiga(TM). Top selling new releases during the quarter were "Bulls vs Blazers and the NBA(R) Playoffs(TM)," "Tony LaRussa Baseball(TM)" and "Mutant League(TM) Football" for
the Genesis system and "Strike Commander(R)" for the IBM PC. Other Electronic


Arts' products appearing on retailer Top 20 lists during the quarter included "PGA Tour(R) II" and "NHL(R) Hockey '93" for the Genesis system, "NHLPA(R) Hockey '93" for the SNES, and "Syndicate" and "Ultrabots(TM)" for the IBM PC. Revenues from PC products were up 60 percent compared to the same quarter last year, the second quarter in a row that revenues from PC products have shown year-over-year growth.
 Revenue growth was achieved in all geographical territories during the quarter. Compared to the same quarter last year, net revenues were up over 65 percent in North America, and 33 percent in international markets. International's revenue growth was lower due to Europe's extraordinary quarter last year when revenues grew over 200 percent and a 15-percent difference in the dollar/pounds sterling exchange rate compared to last year.
 Larry Probst, president and chief executive officer of Electronic Arts, said, "Given the current worldwide economic situation we are extremely pleased with these results. Our revenue and profit improvement is particularly impressive since last June was the time during which both Sega and Nintendo lowered their hardware prices creating unusually high demand for software products. This year the industry is confronted with typical summer seasonality, yet we have been able to perform successfully in this challenging environment."
 NOTE: Sega and Genesis are trademarks of Sega Enterprises Ltd. Nintendo and SNES are registered trademarks of Nintendo of America Inc. IBM is a registered trademark of International Business Machines Corp. Amiga is a registered trademark of Commodore-Amiga Inc. "Bulls vs Blazers and the NBA Playoffs," "Tony LaRussa Baseball," "Mutant League Football" and "Ultrabots" are trademarks of Electronic Arts. "Strike Commander" is a registered trademark of Origin Systems Inc. The NBA is a registered trademark of the National Basketball Association; NHL is a registered trademark of the National Hockey League; and PGA Tour is a registered trademark and used by permission.
 ELECTRONIC ARTS
 Q1 Earnings Announcement, Fiscal Year 1994
 Condensed Statements of Income
 (Unaudited, in thousands, except per-share data)
 Three Months Ended June 30,
 1993 1992
 Net revenues $79,500 $50,099
 Cost of sales 41,595 25,811
 Gross profit 37,905 24,288
 Operating expenses:
 Marketing and sales 9,760 6,358
 General and administrative 5,410 4,353
 Research and development 12,920 6,956
 Total operating expenses 28,090 17,667
 Operating income 9,815 6,621
 Interest and other income, net 686 389
 Income before income taxes
 and minority interest 10,501 7,010
 Provision for income taxes 3,255 2,256
 Income before minority interest 7,246 4,754
 Minority interest in joint venture 72 ---
 Net income $ 7,318 $ 4,754
 Earnings per share $ 0.15 $ 0.10
 Weighted average shares
 outstanding 49,733 46,524
 Condensed Balance Sheets
 (In thousands)
 June 30, March 31,
 1993 1993
 (unaudited)
 ASSETS
 Cash and cash equivalents $ 99,585 $ 98,029
 Accounts receivable, net 18,993 26,382
 Inventories 15,223 12,578
 Prepaid royalties 6,236 5,351
 Deferred income taxes 6,930 6,858
 Other current assets 2,261 3,583
 Total current assets 149,228 152,781
 Building, furniture
 and equipment, net 21,605 18,899
 Prepaid royalties 4,481 4,366
 Other assets 5,192 5,211
 Total assets $180,506 $181,257
 LIABILITIES AND SHAREHOLDERS' EQUITY
 Accounts payable $ 24,057 $ 33,771
 Accrued liabilities 31,184 33,916
 Total current liabilities 55,241 67,687
 Minority interest in joint venture 3,295 2,999
 Common stock 465 462
 Paid in capital 53,444 49,770
 Retained earnings 71,459 64,141
 Translation adjustment (3,398) (3,802)
 Total Liabilities and
 Shareholders' Equity $180,506 $181,257
 -0- 7/21/93
 /CONTACT: Jeanne Golly, director of public relations, 415-513-7742, or Stan McKee, senior vice president, chief financial and administrative officer, 415-513-7345, both of Electronic Arts/
 (ERTS)


CO: Electronic Arts ST: California IN: CPR ENT SU: ERN

GT -- SF010 -- 4106 07/21/93 16:05 EDT
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Date:Jul 21, 1993
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