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Activision has solid 2013, expects  Destiny  to be 'billion dollar franchise'
Activision has solid 2013, expects Destiny to be 'billion dollar franchise'
February 6, 2014 | By Christian Nutt




Activision Blizzard announced today that it hit revenues of $4.58 billion for 2013, down a bit from 2012's $4.86 billion. This comes despite the fact that, according to the company, Call of Duty: Ghosts was the number one selling title for the fourth quarter of 2013, and also the best-selling game on next-gen consoles.

It also found success with its StarCraft and Skylanders franchises. Digital revenues for the company were $1.56 billion, making up 34 percent of its total revenues this year.

Profits were $1.01 billion for the year, down from $1.15 billion a year prior.

For 2014, the company is hanging its hopes on Bungie's upcoming shooter Destiny. In a statement, CEO Bobby Kotick said "We expect Bungie’s Destiny... to be Activision Publishing’s next billion dollar franchise."

The market response to the results was positive, with Activision shares shooting up almost 10 percent, to $18.80 per share, as of posting time.


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Comments


Josh Charles
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No pressure, Bungie.

Christian Nutt
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Up till now they were just kinda coasting, but when they read the earnings announcement...

matt landi
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"Activision Blizzard announced today that it hit profits of $4.58 billion for 2013, down a bit from 2012's $4.86 billion"

Should profits be changed to revenue? I could be wrong, but it seems like a boatload of profit for a publisher.

Christian Nutt
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Yep, that was a mistake in reporting, and has been corrected.

Jonathan Murphy
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Did Bungie ever make MS $1 billion off a single game? Is this a hint that we'll see a sequel to Destiny every year?

Christian Nutt
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I doubt every year -- it will keep changing and adding content, though, I expect.

I think Destiny has very aggressive live service plans, which go beyond the typical for console games. They shared some details at the reveal:

http://www.gamasutra.com/view/news/186801/Analysis_Bungie_and_Act
ivisions_reveal_of_Destiny.php

Also, I dug up this link:
http://www.forbes.com/sites/danielnyegriffiths/2013/11/06/activis
ion-boasts-1-billion-call-of-duty-ghosts-day-one-sales/

$1bn sell-in, not sell-through, apparently, but that's apparently "their thing" and they intended to compare to COD.

Jonathan Murphy
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AC4, WoW, Mario, and any other big franchise are doing ok, but not great in sales. In the new generation, variety, originality, value will likely dominate. It feels like they are gambling all on red, and the casino isn't even built yet.

G Irish
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If you add up the sales from the last couple of Halo releases it easily went over $1 billion in sales (Reach, ODST, and 3 sold about 27.5 million copies). That's while only being available on one console. With the multiplatform approach I think Destiny will sell far more units per release than Halo did.

However, I don't think they'll be going to a yearly release model. I don't think you could realistically do a game like this every year unless you had more than one studio working on it, or you dramatically scaled back the scope of each release.

Jonathan Murphy
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Thus my analogy. They are gambling before the casino is built. BTW I checked their budget ($140m) for Destiny. They need to make $1 billion quickly. Expect yearly sequels with a boat load of DLC.

G Irish
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That would be true of any AAA game. You have to make some predictions about the future to justify the capital outlays required for AAA titles. The bet Activision is making on Destiny isn't outrageous consisting the history of Bungie where the market is right now.

I for yearly sequels, that is extremely unlikely unless another studio takes on the odd years. Especially with where the bar has been set with this generation of games.

Michael Joseph
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"We expect Bungie’s Destiny... to be Activision Publishing’s next billion dollar franchise."

That's something...

Developer of old IP free of old publisher starts new IP that resembles the old IP with new publisher. New publisher expects new IP to be as popular if not more so than the old IP.

I predict that Activision is not making it's predictions based on the amazing-ness of this new game but upon future marketing efforts, the past performance of the old IP, and a formula.

G Irish
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Well let's look at Activision's prediction. If they're saying $1 billion in revenue that means roughly 17 million units sold.

The sales of each Halo game (that Bungie made) were as follows:

Halo: 6.43 million
Halo 2: 8.49 million
Halo 3: 11.87 million
Halo ODST: 6.22 million
Halo Reach: 9.52 million

This means each full release of Halo from Halo 2 onward sold at least 8 million units while only being offered on one console. Activision is making the bet that Destiny will be similar in popularity to Halo, while being on both Sony and Microsoft consoles, which should roughly double sales.

In that case, Destiny will probably get close to the billion dollar mark in revenue for the first game in the series. If it doesn't, it will definitely get there with the 2nd release.

Bungie as a studio has not really released a stinker as of yet, so based on their track record, Destiny will probably deliver on quality.

All in all, it doesn't seem to be too crazy of a prediction for Activision. It sounds like they intend on giving Destiny full marketing support, and preorders are already pretty strong for a game that won't be released for another 7 months. As long as the reviews are strong and players buy into the vision Bungie is pushing, it should do as well as they predict. I don't think they'll get to GTA V numbers but 16-20 million should be within reach.


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