ELECTRONIC ARTS INC.EA

ELECTRONIC ARTS INC. Commitments Disclosure

10-KFiled May 11, 20263 min read
COMMITMENTS AND CONTINGENCIES
Development, Sports Organizations, and Other Content Licenses: Payments and Commitments
The products we produce in our studios are designed and created by our employee designers, artists, software programmers and by non-employee software developers (“independent artists” or “third-party developers”). We typically advance development funds to the independent artists and third-party developers during development of our games, usually in installment payments made upon the completion of specified development milestones. Contractually, these payments are generally considered advances against subsequent royalties on the sales of the products. These terms are set forth in written agreements entered into with the independent artists and third-party developers. In addition, we have certain sports organizations and other content license contracts that contain minimum guarantee payments and marketing commitments to promote the games we publish that may not be dependent on any deliverables.
These developer and content license commitments represent the sum of the cash payments for flat fees, minimum guaranteed payments, and service payments. The majority of these commitments are conditional upon performance by the counterparty. These payments and any related marketing and development commitments are included in the table below.
The following table summarizes our minimum contractual obligations as of March 31, 2026 (in millions):
Fiscal Years Ending March 31,
Total20272028202920302031Thereafter
Unrecognized commitments
Developer/licensor commitments$2,058 $340 $474 $430 $415 $361 $38 
Marketing commitments1,239 304 282 230 196 216 11 
Senior Notes interest618 32 36 36 36 36 442 
Operating lease imputed interest65 15 12 10 8 7 13 
Operating leases not yet commenced34 2 4 5 5 5 13 
Other purchase obligations376 101 121 97 39 14 4 
Total unrecognized commitments4,390 794 929 808 699 639 521 
Recognized commitments
Senior Notes principal and interest1,505 5 — — — 750 750 
Operating leases369 61 59 42 29 38 140 
Total recognized commitments1,874 66 59 42 29 788 890 
Total Commitments$6,264 $860 $988 $850 $728 $1,427 $1,411 
The unrecognized amounts represented in the table above reflect our minimum cash obligations for the respective fiscal years, but do not necessarily represent the periods in which they will be recognized and expensed in our Consolidated Financial Statements. In addition, the amounts in the table above are presented based on the dates the amounts are contractually due as of March 31, 2026; however, certain payment obligations may be accelerated depending on the performance of our operating results.
In addition to the amounts included in the table above, in our Consolidated Balance Sheets as of March 31, 2026, we had a net liability for unrecognized tax benefits and related interest totaling $654 million. While it is reasonably possible that a material reduction of unrecognized tax benefits may occur within the next 12 months, the actual amount could vary significantly depending on the ultimate timing and nature of any settlements and tax interpretations.
Legal Proceedings
We are subject to claims and litigation arising in the ordinary course of business. We do not believe that any liability from any reasonably foreseeable disposition of such claims and litigation, individually or in the aggregate, would have a material adverse effect on our Consolidated Financial Statements.

Historical Timeline

Fiscal YearFiled
2026May 11, 2026Showing above
2025May 13, 2025
2024May 22, 2024
2023May 24, 2023
2022May 25, 2022
2021May 26, 2021
2020May 20, 2020
2019May 24, 2019
2018May 23, 2018
2017May 24, 2017
2016May 27, 2016

About Commitments Disclosures

Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.

Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.

Other Available Disclosures

Income TaxesRevenueEarnings Per ShareFair ValuePP&EGoodwill & IntangiblesLeasesSegmentsStock CompensationNew StandardsPay vs Performance