ELECTRONIC ARTS INC.EA
ELECTRONIC ARTS INC. Fair Value Disclosure
FAIR VALUE MEASUREMENTS
There are various valuation techniques used to estimate fair value, the primary one being the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining fair value, we consider the principal or most advantageous market in which we would transact and consider assumptions that market participants would use when pricing the asset or liability. We measure certain financial and nonfinancial assets and liabilities at fair value on a recurring and nonrecurring basis.
Fair Value Hierarchy
The three levels of inputs that may be used to measure fair value are as follows:
•Level 1. Quoted prices in active markets for identical assets or liabilities.
•Level 2. Observable inputs other than quoted prices included within Level 1, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities.
•Level 3. Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of assets or liabilities.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
As of March 31, 2026 and 2025, our assets and liabilities that were measured and recorded at fair value on a recurring basis were as follows (in millions):
| Fair Value Measurements at Reporting Date Using | |||||||||||||||||||||||||||||
As of March 31, 2026 | Quoted Prices in Active Markets for Identical Financial Instruments | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||||||||||||
| (Level 1) | (Level 2) | (Level 3) | Balance Sheet Classification | ||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||
| Bank and time deposits | $ | 33 | $ | 33 | $ | — | $ | — | Cash equivalents | ||||||||||||||||||||
| Money market funds | 502 | 502 | — | — | Cash equivalents | ||||||||||||||||||||||||
| Available-for-sale securities: | |||||||||||||||||||||||||||||
| Corporate bonds | 52 | — | 52 | — | Short-term investments | ||||||||||||||||||||||||
| U.S. Treasury securities | 33 | 33 | — | — | Short-term investments | ||||||||||||||||||||||||
U.S. agency securities | 2 | — | 2 | — | Short-term investments | ||||||||||||||||||||||||
Foreign government securities | 5 | — | 5 | — | Short-term investments | ||||||||||||||||||||||||
| Asset-backed securities | 24 | — | 24 | — | Short-term investments | ||||||||||||||||||||||||
| Foreign currency derivatives | 35 | — | 35 | — | Other current assets and other assets | ||||||||||||||||||||||||
Deferred compensation plan assets (a) | 46 | 46 | — | — | Other assets | ||||||||||||||||||||||||
| Total assets at fair value | $ | 732 | $ | 614 | $ | 118 | $ | — | |||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||
| Foreign currency derivatives | $ | 25 | $ | — | $ | 25 | $ | — | Accounts payable, accrued, and other current liabilities and other liabilities | ||||||||||||||||||||
Deferred compensation plan liabilities (a) | 46 | 46 | — | — | Other liabilities | ||||||||||||||||||||||||
| Total liabilities at fair value | $ | 71 | $ | 46 | $ | 25 | $ | — | |||||||||||||||||||||
| Fair Value Measurements at Reporting Date Using | |||||||||||||||||||||||||||||
| As of March 31, 2025 | Quoted Prices in Active Markets for Identical Financial Instruments | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||||||||||||
| (Level 1) | (Level 2) | (Level 3) | Balance Sheet Classification | ||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||
| Bank and time deposits | $ | 58 | $ | 58 | $ | — | $ | — | Cash equivalents | ||||||||||||||||||||
| Money market funds | 904 | 904 | — | — | Cash equivalents | ||||||||||||||||||||||||
| Available-for-sale securities: | |||||||||||||||||||||||||||||
| Corporate bonds | 46 | — | 46 | — | Short-term investments | ||||||||||||||||||||||||
| U.S. Treasury securities | 12 | 12 | — | — | Short-term investments | ||||||||||||||||||||||||
| Foreign government securities | 4 | — | 4 | — | Short-term investments | ||||||||||||||||||||||||
| Asset-backed securities | 50 | — | 50 | — | Short-term investments | ||||||||||||||||||||||||
| Foreign currency derivatives | 28 | — | 28 | — | Other current assets and other assets | ||||||||||||||||||||||||
Deferred compensation plan assets (a) | 36 | 36 | — | — | Other assets | ||||||||||||||||||||||||
| Total assets at fair value | $ | 1,138 | $ | 1,010 | $ | 128 | $ | — | |||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||
| Foreign currency derivatives | $ | 26 | $ | — | $ | 26 | $ | — | Accounts payable, accrued, and other current liabilities and other liabilities | ||||||||||||||||||||
Deferred compensation plan liabilities (a) | 36 | 36 | — | — | Other liabilities | ||||||||||||||||||||||||
| Total liabilities at fair value | $ | 62 | $ | 36 | $ | 26 | $ | — | |||||||||||||||||||||
(a)The Deferred Compensation Plan consists of various mutual funds. See Note 14 for additional information regarding our Deferred Compensation Plan.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | May 11, 2026 | Showing above |
| 2025 | May 13, 2025 | |
| 2024 | May 22, 2024 | |
| 2023 | May 24, 2023 | |
| 2022 | May 25, 2022 | |
| 2021 | May 26, 2021 | |
| 2020 | May 20, 2020 | |
| 2019 | May 24, 2019 | |
| 2018 | May 23, 2018 | |
| 2017 | May 24, 2017 | |
| 2016 | May 27, 2016 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.