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Is it game over for Electronic Arts (NASDAQ: EA)? Shares of the video games mogul crashed 17.5% through 11:55 a.m. ET Thursday morning after preannouncing fiscal Q3 2025 earnings last night.

Wall Street analysts expected EA to earn at least $1.15 per share in fiscal Q3, but the actual news will be worse. To get ahead of the bad news, management decided to "preannounce" earnings last night, and it seems the magic number will be $1.11.

EA's Q3 earnings

The news gets worse. Heading into fiscal 2025, EA had told investors it would grow its "live services net bookings" -- that's the company's net revenue, plus any changes in deferred net revenue for online-enabled games -- in the mid-single digits this year. The company is sticking with the "mid-single digits" bit of its guidance, but now it's saying it will be a mid-single-digits decline, rather than growth.

EA blamed the reversal on a slowdown in bookings for its popular Global Football franchise, plus a "nearly 50%" shortfall in the number of players it expected to be playing its Dragon Age games in Q3.

What this all translates to in terms of dollars and cents is that EA now thinks its Q3 net revenue will be only about $1.88 billion, and earnings, as mentioned, will be $1.11.

Is EA stock a sell?

The news may not be all bad. Yahoo! Finance estimates have Wall Street looking for $2.33 billion in Q3 sales, and EA is going to miss that mark. But Yahoo! Finance, at least, also predicted EA would earn only $1.06 -- not $1.15 -- this quarter. If EA management is right about its $1.11 profit, then it's actually going to be this estimate, albeit it won't be quite as big of a beat as EA had hoped to report.

So where does this leave the stock? That's the other bad news. Taking the new earnings forecast as a given, at $117.50 per share, EA stock now costs about 30 times trailing earnings. For a stock with slumping sales, that's probably still too expensive to buy.

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