August 3, 2012
Activision Earnings Up, Blizzard Still Struggling
Michael Harper for redOrbit.com — Your Universe Online
By the numbers, the largest independent game publisher was able to earn more and increase their revenue as well as raise their guidance for the full year. They were able to garner these numbers as the rest of the traditional video game industry is feeling the pinch from mobile game sales and online game sales.
Earnings per share rose to 20 cents, up from 10 cents per share in the previous year, in addition to boosting their Non-Generally Accepted Accounting Principles, (non-GAAP) revenues to $1.05 billion, a considerable increase from $699 million a year ago.
“Our performance was driven by strong audience demand for our great games. We are very excited to have announced our expanded investment in China through Activision Publishing´s agreement with Tencent to bring the Call of Duty franchise to the Chinese market,” explained Bobby Kotick, Activision´s chief executive, in a statement.
“For the remainder of the year,” said Kotick, “we are excited about our product slate which includes Activision Publishing´s Skylanders Giants and Call of Duty: Black Ops II and Blizzard Entertainment´s World of Warcraft: Mists of Pandaria”
Activision is expecting big numbers for the rest of the year as they get ready for a prosperous holiday season and a few “key franchise launches” coming up.
Kotick isn´t blind to the perception that the game industry is suffering, however. According to Activision´s chief executive, the top 5 games in the industry continue to sell well, up 11% over the past couple years. That Activision just so happens to make several top 5 hits every year is what´s keeping their numbers high.
Their next expected blockbuster hit, Call of Duty: Black Ops II, will hit the shelves November 13. Wedbush securities analyst Michael Pachter has high expectations for the new release, saying the game could sell as many as 25 million copies in its lifetime. Multiply this number by the $60 each gamer spends to own this game, and Activision could earn up to $1.5 billion in revenue alone.
Elsewhere in new releases, Activision plans to launch Transformers: Fall of Cybertron and Call of Duty: Modern Warfare 3 Content Collection #3 and #4 during their third quarter. They´re also gearing themselves up for a video game edition of the best-selling mobile video game, Angry Birds. The company will release a trilogy of Angry Birds games for the console, expanding the once iPhone-only game of flinging and strategy.
The only dark spot on Activision´s earnings call was their Blizzard division, maker of World of Warcraft. During the call, the company announced shares of Activision Blizzard were down by 5%. World of Warcraft´s numbers were down as well, as Blizzard announced 9.1 million active players during the last quarter, down from 10.2 million in the first quarter. At its peak popularity, there were as many as 12 million World of Warcraft players in October 2010.