Activision Blizzard Reports Better than Expected Financial Results

According to a report released recently for its fiscal fourth quarter, Activision Blizzard has had better than expected financial results. For the quarter ending January 31, 2011, Activision brought in $2.41 billion in net revenue, slightly down from last year’s $2.55 billion during the same period. This latest quarter puts the company’s full year revenues at $4.49 billion, up from $4.48 billion in 2010.

Titles such as Call of Duty: Modern Warfare 3, a number one seller for 2011; the company’s new IP Skylanders, which experienced great success in selling over 20 million toys; and the company’s digital products were credited as the biggest contributors to the better than expected financial results for the last quarter.

Activision has also reported that $1.6 billion, or 34% of its over all revenue, came from digital sales for the full year. The Call of Duty: Elite service has also seen success for the company as it has attracted 1.5 million annual premium subscribers and over 7 million registered users. This quarter also saw the number of World of Warcraft subscribers dip slightly, dropping from 10.3 million last quarter to 10.2 million.

Looking to the future and toward the end of its 2012 fiscal year, Activision estimates that it will earn $4.5 billion. It was also confirmed by Blizzard Entertainment’s co-founder, Mike Morhaime, that the long awaited release of Diablo III is expecting a Q2 launch during Activision’s investor conference call.

Analysis: With the Call of Duty franchise continuing to climb in popularity among gamers of all ages, Activision has capitalized on this in the only way they know how: by churning out a new Call of Duty game yearly. Although I’m sure others have been turned off by the over saturation of realistic military FPS, the franchise continues to perform well for them, constantly breaking sale records every year. One does become concerned if what happened with Guitar Hero will happen to Call of Duty if Activision continues at this rate, however.

World of Warcraft is, well, World of Warcraft, and it will just keep on going at its own pace. I myself never got into it, but I can totally understand the appeal. On the other hand, I’m very surprised by the sheer number of subscribers to the Call of Duty: Elite service, mainly because I didn’t think there would be that much of a demographic that would want such a service to warrant it. But bravo to Activision, who managed to build a compelling service that people actually wanted to use but wasn’t a necessity to enjoy the game (e.g. Battlelog).

I couldn’t be happier hearing that Skylanders, a game that was mainly marketed to a younger audience, has enjoyed so much success. It’s an interesting idea that could be considered a gimmick, sure, but it’s a likable one. It doesn’t hurt that the game was also very enjoyable and a lot of fun. The fact that the sequel, Skylanders Giants, has been shown is very promising, as it hopes to builds on the experience and fun of the toys while also ramping it up in size and activities.

Nathan Wood

About Nathan Wood

When he picked up a controller on that fateful day at the age of 6, Nathan had no idea how quickly it would captivate him. Enjoying a wide range of games, he is up for anything as long as it is of good quality, interesting or laughably bad. When not playing or writing about video games, he enjoys music, film, basketball and art. He is currently completing his last year of his IB diploma before mastering the great land known only as: University.