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Activision Blizzard’s net bookings of $ 1.88 billion in the third quarter ended September 30 matched Wall Street expectations, with net bookings up 6% from $ 1.77 billion a year ago. year – a tough comparison since the pandemic drastically increased gaming revenue a year ago.
Overall, the quarter’s report is a mix of good and average news at a time when the company’s only major release was the launch of the Diablo II: Resurrected remaster.
On a GAAP basis, revenue was $ 2.07 billion for the third quarter, up 6% from $ 1.954 billion a year earlier. Earnings per share were 82 cents, compared to 78 cents per share. It was well above the company’s own outlook of 64 cents.
Non-GAAP earnings per share was 89 cents, which, after taking into account deferrals of -17 cents per share, compared to analysts’ expectations of 70 cents per share and 88 cents per share a year ago. In after-hours trading, Activision Blizzard’s stock is down 8% to $ 70.90 per share.
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During a call to an analyst, Kotick said Jen Oneal, co-director of Blizzard Entertainment, was leaving the company. Blizzard continues to be in the news with updates related to the gender discrimination lawsuits against the company. The California Department of Fair Employment and Housing sued this summer, alleging that Activision Blizzard had a “fellowship house culture” that made life difficult for female employees.
Most of the fallout in terms of major revamps related to business surveys has fallen on Blizzard. Oneal and Mike Ybarra replaced J. Allen Brack as co-leaders of Blizzard, and now Ybarra will lead the division on his own. On top of that, the company has said that Overwatch 2 and Diablo IV have been delayed.
“I am pleased to report strong third quarter results ahead of our previous outlook,” said Bobby Kotick, CEO of Activision Blizzard, in a statement. âWe are excited about the launch of Call of Duty this week and look forward to continued success in the fourth quarter. I want to thank our employees for their continued commitment to each other, the company and our players. We look forward to sharing updates on the progress of our workplace initiatives, as well as our business performance. “
Net in-game bookings were $ 1.20 billion from the third quarter of 2020. Overall, the company’s monthly active users were 390 million players for the third quarter.
The company has reiterated its commitment to being the most welcoming and inclusive company in the gaming industry in response to lawsuits that have kept the Company’s Blizzard Entertainment division in the news. The state lawsuit alleged that women were either harassed, made uncomfortable or abused when it came to career advancement.
Repeating a claim it made earlier, Activision Blizzard said more than 20 people have left the company in recent months due to ongoing investigations. The company plans to invest $ 250 million over the next 10 years in initiatives that promote expanding opportunities in games and technology for under-represented communities.
The company also plans to increase its percentage of women and non-binary people in its workforce by 50% over the next five years. The company has 10,000 employees and thousands of game openings in production, Kotick said in an interview with GamesBeat.
It will be difficult to do with the state lawsuit hanging over its head, but the company has settled a separate lawsuit by the Federal Equal Employment Opportunity Commission for $ 18 million. All the litigation related to the case continues to keep the company in the news, and this will likely make it difficult for the company to hire all the right people it needs for all the games going into production.
On the user side, the company said the total number of users was 390 million, a stable figure from the same number a year ago.
Activision users were 119 million in the third quarter, up from 111 million a year ago and 127 million in the second quarter.
Blizzard users were down to 26 million from 27 million a year ago and stable from the second quarter. It’s telling even though the Diablo II: Resurrected remake launched during the quarter. Greater efforts to help stabilize World of Warcraft and Overwatch numbers are underway, but these are coming in the future.
And King has seen its users reach 245 million, up from 249 million a year ago and 255 million in the previous quarter. But King’s revenue grew 20% in the quarter compared to a year ago. Blizzard also increased revenue by 20% from a year ago, and Activision saw revenue decline 17% in the quarter due to the launch of Tony Hawk’s Pro Skater 1 + 2 ago. one year and no new games were released this quarter. Over the past nine months, Activision’s revenue has been on the rise.
Call of Duty: Warzone has seen a drop in user numbers in part because content is aging and because the company had a huge bump from the pandemic a year ago. But the company has new Warzone content in the form of a new map on December 2, following the launch of Call of Duty: Vanguard (the latest premium game from Sledgehammer Games studio) on November 5.
He pointed out that net bookings for Call of Duty: Mobile were up 40% in the third quarter compared to a year ago. The Call of Duty ecosystem has seen sustained player reach, engagement and investment far above levels seen before the introduction of free experiences on console, PC and mobile. Overall activity in Call of Duty is still three times its level in the third quarter of 2019, before the March 2020 introduction of free-to-play Warzone and Call of Duty: Mobile.
The company said it has a solid launch for Diablo II: Resurrected, the remastered title. Diablo Immortal is still in testing for release on mobile platforms in the first half of next year. The World of Warcraft engagement continues to benefit from the combination of Modern and Classic modes under one subscription. Hearthstone’s net bookings remained stable during the quarter.
King increased on the strength of good hours played in the quarter compared to a year ago, with players responding positively to a more frequent cadence of engaging in-game content and events for key titles. The number of payers increased by a double-digit percentage from the previous year quarter.
Net in-game bookings for Candy Crush increased by more than 20% year-on-year, with Candy Crush again being the top-grossing game franchise in the US app stores.
At the end of the third quarter, King kicked off the Candy Crush All-Stars US tournament, which has seen a significant increase in installs, games played and in-app purchases in recent weeks.
King also ramped up and fine-tuned content delivery in Farm Heroes, its second-largest franchise. This work continued to bear fruit in the third quarter, with net in-game bookings increasing by approximately 20% year-on-year since the start of the year.
King’s advertising business has experienced strong growth, with quarterly revenue growing sequentially and year over year to a new high. Both volume and prices have increased sharply year over year, benefiting from the team’s growing relationships with demand partners and the continued rise of new categories of advertisers.
The company is forecasting fourth-quarter revenue of $ 2.91 billion, above its own earlier projection of $ 2.78 billion. Net income is expected to be $ 1.38 per share for the fourth quarter. For the full year, the company expects revenue of $ 8.784 billion, up 3% from the previous year. Activision Blizzard expects consensus earnings per share of $ 3.70 per share.
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