Activision Blizzard today revealed better-than-expected fiscal results for the publisher's third quarter ended September 30. The company had forecast net revenues of $680 million, but posted revenues of $703 million for the period (down year-over-year from $711 million), with earnings per share of $0.01 (compared to guidance of a loss per share of $0.03). That translated into net income of $15 million.
Guitar Hero 5, along with catalog sales for other Guitar Hero and Call of Duty titles and of course continued success for World of Warcraft, drove the bottom line for Activision in Q3. And looking at the first nine months, with Guitar Hero World Tour and Call of Duty: World at War respectively, Activision Blizzard had the #1 and #2 best-selling third-party titles in North America and Europe (according to the NPD Group, and Charttrack and Gfk).
"Our performance was driven by positive audience response to Activision Publishing's Guitar Hero 5, Marvel: Ultimate Alliance 2, and the Guitar Hero and Call of Duty franchises, as well as Blizzard Entertainment's World of Warcraft. Year to date through September 30, the Guitar Hero franchise was the #1 best-selling third-party franchise in North America and Europe. For the month of September, sales of music games in the U.S. increased 72% in dollars year over year, which demonstrates the sustained interest in this new and important game category," said Bobby Kotick, CEO of Activision Blizzard. "During the quarter, we continued to see strong sales for Call of Duty World at War and associated map packs, which year to date have sold more than seven and half million units. 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%. This success is the result of our focus on delivering the highest game quality and the best entertainment experiences possible for our consumers."
He continued, "We believe we have the industry's strongest holiday release schedule which includes Bakugan Battle Brawlers, Band Hero, Infinity Ward's Call of Duty: Modern Warfare 2, DJ Hero and Tony Hawk: RIDE. We are committed to making great games and our fall releases deliver against this more than ever before. As of today, our calendar 2009 financial outlook remains unchanged, and we still expect to deliver record non-GAAP operating margins based on the strength of the Call of Duty franchise and high consumer anticipation for Modern Warfare 2, which we project could be the largest entertainment launch of the year. Even though there is a great deal of economic uncertainty in the marketplace and the consumer risks around the holiday season are high, we believe that our strong balance sheet and solid cash position, coupled with our leading franchises, operational capabilities and broad global reach will enable us to take advantage of the long-term opportunities afforded by our industry."
Activision is maintaining its previously announced full-year outlook for net revenues of $4.05 billion and earnings per share of $0.26.
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