Electronic Arts 2004 Annual Report Download - page 80

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Class A Common Stock Year Ended March 31,
(In thousands, except per share data) 2004 2003 2002
Net income:
As reported - basic ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $577,292 $329,212 $124,256
Deduct: Total stock-based employee compensation expense
determined under fair-value-based method for all awards, net of
related tax eÅects ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (97,030) (83,805) (72,751)
Add: Stock-based employee compensation expense included in
reported net income, net of related tax eÅects ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 124 Ì Ì
Pro forma - basic ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $480,386 $245,407 $ 51,505
Year Ended March 31,
2004 2003 2002
As reported - diluted ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $577,292 $317,097 $101,509
Deduct: Total stock-based employee compensation expense
determined under fair-value-based method for all awards, net of
related tax eÅects ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (97,030) (83,863) (73,596)
Add: Stock-based employee compensation expense included in
reported net income, net of related tax eÅects ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 124 Ì Ì
Pro forma - diluted ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $480,386 $233,234 $ 27,913
Earnings per share:
As reported - basic ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 1.95 $ 1.17 $ 0.45
Pro forma - basic ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 1.63 $ 0.87 $ 0.19
As reported - diluted ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 1.87 $ 1.08 $ 0.35
Pro forma - diluted ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 1.58 $ 0.81 $ 0.10
During the year ended March 31, 2004, compensation expense for Class B stock option plans, based on the
estimated fair value at the grant dates in accordance with the provisions of SFAS No. 123, would not have
had a material impact on reported net income and net earnings per share. Compensation expense for Ñscal
2003 and Ñscal 2002 was $0.1 million and $0.8 million, respectively. Compensation expense for Ñscal 2003
would have increased our net loss by $0.02 to $(2.79) for both basic and diluted loss per Class B share.
Compensation expense for Ñscal 2002 would have increased our net loss by $0.15 to $(3.92) for both basic and
diluted loss per Class B share.
In March 2004, the Financial Accounting Standards Board, ""FASB'', issued an exposure draft on the
Proposed Statement of Financial Accounting Standards, ""Share-Based Payment Ì an amendment of FASB
Statements No. 123 and 95''. The proposed statement addresses the accounting for share-based payment
transactions with employees and other third-parties. The proposed standard would eliminate the ability to
account for share-based compensation transactions using APB No. 25, ""Accounting for Stock Issued to
Employees'', and generally would require that such transactions be accounted for using a fair-value-based
method. If the Ñnal standard is approved as currently drafted in the exposure draft, it would have a material
impact on the amount of earnings we report. Management has not yet determined the impact that the
proposed statement will have on our business.
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