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Activision Blizzard sees new Q1 records, though share prices still falter

Activision Blizzard sees new Q1 records, though share prices still falter

May 3, 2018 | By Alissa McAloon

May 3, 2018 | By Alissa McAloon
More: Business/Marketing

Activision Blizzard has released its financial report detailing the operations of the company during the quarter ending March 31, 2018, noting that the company hit a new quarterly record for GAAP net revenue, both overall and from just digital sales

While the company has raised its full-year earnings forecast by what it describes as a “modest” amount, Activision Blizzard shares notably fell after the earnings report was unintentionally released (with inaccurately low results) early by Dow Jones.

The mix-up resulted in a temporary trading halt, but not before Activision Blizzard’s shares fell by 5 percent. The company's stock was unfrozen shortly after, but the market still closed with Activision Blizzard down 2.3 percent from its pre-report stock. 

CNBC points out that, while adjusted earnings for the first quarter in regards to earnings per share and revenue exceeded projections, second-quarter estimates fell below stockholder expectations.

That second quarter guidance reported earnings per share to come in at 31 cents, down from a 47 cent estimate, with revenue at $1.35 billion, again down from expected $1.45 billion estimates. 

Overall, Activision Blizzard reported GAAP net revenue of $1.9 billion, beating out both its prior $1.8 billion projection and the $1.7 billion reported during the same period last year. Looking at just net bookings (the net amount of products and services sold in the period, excluding impact from deferrals) Activision Blizzard reported $1.38 billion, both a new Q1 record and an increase from the $1.2 billion reported during the first quarter last year. The company notes that its net bookings metric includes products and services sold digitally or physically including license fees, merchandise, and publisher incentives. 

Meanwhile, net bookings from digital sources alone came in at $1.20 billion, up from $1.07 billion the preceding year, also a new quarterly record for the company. In-game net bookings alone came in at approximately $1 billion companywide, a new quarterly record as well. 

In its earnings release, Activision Blizzard makes an effort to point out that these results come during a quarter free of large content releases, something the company credits to the “enduring nature of our franchises and shift to a games-as-a-service model.”

The company notes that, overall, Activision Blizzard saw 374 million monthly active users across its properties in the quarter. Meanwhile, Activision Blizzard subsidiary King alone saw 285 million monthly active users. Activision independently saw 51 million monthly active users, a year-over-year growth the company credits in part to Call of Duty: WWII, and Blizzard recorded 38 million monthly active users, noting that World of Warcraft “over-performed versus the prior expansion” in the wake of its next big content drop, Battle for Azeroth, later this year.

“Our continued ability to set new records speaks to the quality of our teams and the breadth and enduring nature of our portfolio of franchises against the backdrop of a large and growing interactive market,” said Activision Blizzard CEO Bobby Kotick in a press release. “As we look ahead, our innovative core gaming pipeline, as well as initiatives like mobile, esports, and advertising, will continue to drive growth for our business.”

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