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Activision Posts $15M Profit, Beats Third Quarter Expectations
by Chris Remo
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November 5, 2009
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Publisher Activision Blizzard came in above expectations in its latest financial reporting period, posting $15 million in profits on $703 million in revenue for the quarter that ended September 30.
While revenues were down a slight 1 percent year-over-year, they still beat Wall Street expectations -- sales totaled $755 million on a non-GAAP basis, with analyst predictions averaging $724 million. And profit was up massively from a net loss of $108 million during the same period in 2008.
That considerable disparity is largely due to the merger between Activision and Vivendi S.A., which saw Vivendi take a majority stake in Activision mere days into the third quarter of 2008 and creating a somewhat uneven comparison between the two years' results.
Unsurprisingly, Activision called out the World of Warcraft, Guitar Hero, and Call of Duty brands as being star performers for both the third calendar quarter as well as the first nine months of 2009.
"Despite a challenging overall software market, the company grew its quarterly U.S. share by 3.1 points over the previous year to 13.3 percent," CEO Bobby Kotick said in a statement. "This success is the result of our focus on delivering the highest game quality and the best entertainment experiences possible for our consumers."
Activision's strong results for the quarterly led the company to confirm its existing financial guidance, which factors in strong expected performance from the company's holiday season heavy hitters like Call of Duty: Modern Warfare 2. It continues to project fourth-quarter 2009 revenues of $1.33 billion and total 2009 calendar year revenues of $4.05 billion.
[Update: In a conference call following Activision's earnings results, CFO Thomas Tippl said the company expects this holiday season to bring stronger music game performance for Activision than last year's -- despite fairly mild response to recently-released DJ Hero so far.
While the music game genre has seen slowing in some areas this year, largely due to softening hardware sales, an Activision executive noted that, at least on the Xbox 360 and PlayStation 3 platforms, core users "continue to be very engaged, and in fact, consumer sell-through on these platforms is up 20% year over year for 2009 to date across the United States and Europe."]
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