Activision raises guidance on PS3 hopes

Following a gangbusters holiday, publisher raises revenue predictions by $30M after reexamining the console's European launch; PS2 Downhill Jam, DS and Wii Guitar Hero announced.

Two weeks after Activision first issued a preliminary earnings report announcing it had a record holiday season, it has increased guidance for the current quarter. On January 25, Activision predicted it would take in $170 million in revenue during the January to March 2007 quarter, the fourth in its 2007 fiscal year. Today, the company increased that number to $200 million.

Speaking to analysts in a conference call, Activision CFO Thomas Tippl said that "better visibility regarding the allocation of PlayStation 3 hardware" was the main reason for the revision. Later, Tippl expanded on that statement, saying Activision had received "more specific information...from Sony on how their units are going to break out" for the console's March 2007 launch in Europe. "We have reflected that in our updated guidance," he said.

But while $200 million is a solid figure for a traditionally slow time, it was just a fraction of Activision's record-setting haul during the October to December 2006 quarter. By the company's estimates, it racked up $822.8 million between October 1 and December 31, 2006, besting the $816.2 million in revenue during the same quarter in 2005. It expects quarterly net income--that is, profit--to rise some 84 percent year on year, going from $67.9 million to $124.8 million. The figures remain preliminary pending an investigation into Activision's stock-option-grant practices.

In a conference call with analysts, Activision Publishing president and CEO Mike Griffith showered praise on his company's bread-and-butter franchises, Call of Duty and Tony Hawk. According to NPD, Call of Duty 3 racked up more than $85.8 million in US sales from its release in November until the end of the year. Activision said it also took in more than $10 million from international sales of Call of Duty 2 map packs on Xbox Live Marketplace during the quarter.

US 2006 sales of Tony Hawk's Project 8 exceeded $43.9 million, while Tony Hawk's Downhill Jam eked out just over $9 million. Despite the latter's lackluster numbers, Activision also announced it was porting the game to the PlayStation 2 during the April to June 2007 quarter.

Above all, though, Griffith singled out Guitar Hero II for particular praise. Despite only being released on one platform--the PS2--the game headbanged out more than $93.6 million in the US alone in 2006, according to NPD. Griffith credited the game's success to an extensive publicity campaign, which includes some 7,500 demo kiosks, and better-than-expected sales of the PS2.

"The PS2's success certainly benefited Guitar Hero and, you know, some would say Guitar Hero maybe benefited the PlayStation 2 platform as well," he said. Griffith also said he expects the PS2 to have surprising longevity. "If you look back at the PSone, when they got down to that $79 price point that year they sold 2.5 million units and there's a long way to go still on the PS2's price point."

Griffith also gave his company's predictions on how the 2007 console race will shape up. Activision's current estimates peg the Xbox 360 as selling 5 million units in North American during the calendar year. The publisher has the Wii, PS2, and PS3 tied at 4 million apiece. The company also said it expects "10 million handhelds" to be bought on the continent during the next 12 months, though no platform was specified. Activision also expects the $59 price carried by most third-party PS3 and 360 games to hold, as will the $49 sticker slapped on Wii games.

For the company's 2008 fiscal year, which begins on April 1, Griffith said Activision will have 60 individual products, or SKUs, which would "aggressively target the Nintendo platforms." He said the company "will be focusing on our most successful franchises--Call of Duty, Tony Hawk, and Guitar Hero," though he stopped short of announcing specific new titles. Griffith did, however, say that Guitar Hero titles are coming to the Wii and DS.

The first quarter of Activision's FY2008 has 360 Guitar Hero II and Call of Duty: Roads of Victory scheduled to ship. It is also the tentative launch window of the long-in-the-making PC shooter Quake Wars: Enemy Territory. Finally, the quarter will see the release of a wide spread of cross-platform games based on three films: Spider-Man 3, Transformers, and Shrek the Third.

243 Comments

  • snukadaman

    Posted Feb 7, 2007 10:46 pm GMT

    people are thinking when the ps3 price drop happens people are going too start buying ps3's...for one thing..if the games are not there it wont happen...second...xbox 360 drops their price too...making that argument null and void...

  • RaiKageRyu

    Posted Feb 7, 2007 10:45 pm GMT

    Yay?

  • jdknight21

    Posted Feb 7, 2007 10:25 pm GMT

    It should be illegal for TH: DJ to get released on another console.

  • SeanBond

    Posted Feb 7, 2007 10:24 pm GMT

    Dj_Lizz (and jtanga): Are you two serious??? Um when you say no good RPG, I suppose you're not counting the TWO rpgs the creator of...FINAL FANTASY is making for the Xbox 360, right? Yeah, I guess the guy responsible for the most popular rpg series of all time probably won't make any "good rpg" on the Xbox 360...Get real.

  • Dj_Lizz

    Posted Feb 7, 2007 10:11 pm GMT

    just like jtanga said ,Ill mark it .........
    no good rpg like FF if there is no japones

  • delriojc1985

    Posted Feb 7, 2007 10:10 pm GMT

    SONY # 1

  • Ackad

    Posted Feb 7, 2007 9:35 pm GMT

    For the people that thinks sony sucks, I think why, Because their idiots and ignorant. But I agree with someone I wont say with one thing, THe sixaxis has no rumble and its touch aint like the other Daulshock.Thats The only thing I think about .

    Add me in ps3!

    PSN : REBEL21

  • SeanBond

    Posted Feb 7, 2007 9:34 pm GMT

    You Sony fanboys should worry about trying to get the Wii out of second place, instead of trying to the topple the 360 just yet...

  • brant_almighty

    Posted Feb 7, 2007 9:30 pm GMT

    chamber 303 no its not

  • SnakeVenom3000

    Posted Feb 7, 2007 9:26 pm GMT

    We will see if this boosts the PS3's sluggish sales.

  • chamber303

    Posted Feb 7, 2007 9:10 pm GMT

    MagusMaleficus

    ps3 is better than 360

  • MagusMaleficus

    Posted Feb 7, 2007 9:06 pm GMT

    John_of_Fire: Why all the fighting? Well, you remember what happened when kids in elementary school disagreed about something, right? The kind of stupid fights that broke out (name-calling, occasional limp-wristed fist fights, and so on)? This whole "my system is better than yours" is basically the online gamer equivalent of that. Only far more stupid - after all, with a few exceptions, we're mostly adults and teens here.

  • chamber303

    Posted Feb 7, 2007 9:04 pm GMT

    john_of_fire
    not a fight
    argument
    its fun
    nothing bad
    its just that console war is the most interesting topic

  • jtanga

    Posted Feb 7, 2007 9:02 pm GMT

    LOL SeanBond...locked in?.....You mean locked the 360 in your closet because u have to buy a ps3.

  • John_of_Fire

    Posted Feb 7, 2007 9:00 pm GMT

    Why is everyone on a PS3 vs Xbox tangent? I could list the reasons I am not a fan of the PS3 but it seems off topic. Activision said they were going to make more money because they believe PS3s will sell well this spring because they will be in stock. So the people who want a PS3 can get a PS3 because they will be in stock and then will by some games by Activision. It's not tough math. This isn't leading to platform exclusives so why all the fighting?

  • SeanBond

    Posted Feb 7, 2007 8:56 pm GMT

    Actually, jtanga, the way things are going right now, a lot of people here who already spent a lot of money on the PS3 are going to have to buy another console...The 360 is already locked in.

  • shazanarkand

    Posted Feb 7, 2007 8:55 pm GMT

    Yuskue76: What?

  • chamber303

    Posted Feb 7, 2007 8:55 pm GMT

    Yuskue76
    get your bro a ps3 along with a nice hdtv and surround sound
    he should be fine after that.

  • Newsboy

    Posted Feb 7, 2007 8:53 pm GMT

    So now Sony is lying to software manufactures about how PS3 is going to suddenly achieve overwhelming success. Please! At the price they're asking a "break-out" will never occure and Activision stockholders are going to get shafted.

  • Yuskue76

    Posted Feb 7, 2007 8:52 pm GMT

    Hello. I've taking things for granted since I was a child. I've completely lost my senses. I'm giving excuses of thinking there's nothing else to do except going to school at 7:00 P,M at night. Every night except for Friday and weekends... I'm really like bad......... I have a twin bro, he's been through so much crap, he doesn't even know how to begin explaining how much crap he suffered in the past 22 years of his life. So, to put this bluntly I've no idea what I can do now.... I've suffered to watch him suffer. It's prolly hard to understand because of the words I use.... and its been adding alot.... I've used up my head and I have basically no knowledge... just doing stuff really random and automatically........ I wish someday I could have it been different if I didn't think so negative all the time... plus I always pick the time where it's hard for me to pick up from.... I even forced myself doing a lot of things I didn't want to do.... so if possible. I think I will continue doing things, but always maybe wished it couldn't been different from now and on.

  • jtanga

    Posted Feb 7, 2007 8:49 pm GMT

    A lot of people in here say sony suck....they always say it suck...why it sucks?....because of the controller?....cpu?.etc.say something..I know they dont have good games right now...but wait until couple of months.

    I think the reason why they bashing sony is because a lot of people in here already spend a lot of money on xbox 360.They are scared they might have to buy another console.

  • xxgunslingerxx

    Posted Feb 7, 2007 8:49 pm GMT

    how is it that xbox fanboys always turn netural or ok news into bad anitps3 news? why do they have to dig so hard to try to find a flaw in the ps3? is it cause they are imature? or insecure? or both?

  • chamber303

    Posted Feb 7, 2007 8:48 pm GMT

    SONY comes up with a new unit that has a very good amount of horsepower. it can also do many other things like play movies on the new blu-ray technology that has prooved itself to be better than anything else on the market.
    why bash the system then? for what reason? the price? its cheap. for what it offers, this ps3 system is cheap.
    there are no games? ok its true but relax, they will come out soon.
    360 had the same problem when it got released but now, there are lots available.
    if you are going to hate a console, hate it for a good reason

  • minime78362

    Posted Feb 7, 2007 8:45 pm GMT

    jc_tkml

    Damn. How many posts does it take to defend the Ps3? Right after I had read this, I look down, and you had at least 3 in the front of the comments.
    It's just a gaming console, you play games, you enjoy it, or you don't. There's no need to argue over something that provides entertainment.

    PS3 Has its strengths, Xbox has its Strengths, and the Wii has its strengths. And they all have their weaknesses.

  • chamber303

    Posted Feb 7, 2007 8:37 pm GMT

    to sell more units, yes. not to make some money. they will loose more by doing this.
    what brings in money is the # of games sold.
    SONY does not care if they loose more $ from the unit.
    besides, just like the ps2, 6 to 7 years from now, the ps3 will still be selling strong. not because its a gaming system but because its more than that unlike any other console to date.

  • jtanga

    Posted Feb 7, 2007 8:36 pm GMT

    All i can say without japanese developer there is no good rpg....

  • kakashi_Itachi7

    Posted Feb 7, 2007 8:35 pm GMT

    you dont know what you are talking about

  • jc_tkml

    Posted Feb 7, 2007 8:35 pm GMT

    sircrayzie
    will if the ps3 did so good and is doing so good then why 2 months into launch and you can find it everywhere. it's nice to have all these little goodies added to the console but people are starting to forget the main reason why it's called a game console because it's suppose to play games. my point to why the browser on the ps3 is useless, will let me start i have a 360 and a wii, on my wii I have to internet trail, I got it because hey it's free. and found that it's a waste of my time and I never use it anyways. it's not like slow or anything it's decent in loading times and stuff but the ease of use is not there like it is on the pc. and I'm pretty sure the ps3's browser is any different from the wii's. so come to say we don't need all these little gimicks they put in to try and drain more money from us. I have a computer I have a exspensive dvd player, so please just give me what I paid for a GAME CONSOLE. i'm still gonna buy a ps3 one day when they drop the price and put better 1 party game on the market.

    well they didn't consider you when they made it cause you're going to bash them whatever happens anyway

  • jc_tkml

    Posted Feb 7, 2007 8:33 pm GMT

    okassar

    "PS3 is already doing bad and is 1-2 years away from a price drop due to tremendous loss of money per unit sold"

    t
    chamber303

    his does not make any sense dude.

    couldn't be anymore right how would you even know I read some news that Ps3 might even lower the price as early as march

  • jc_tkml

    Posted Feb 7, 2007 8:31 pm GMT

    Aaron_130
    Activision = put your efforts into the competition, i.e; the consoles that are selling! not the PS3.

    well they are helping ps3 to make it a competition I don't wanna to see MS controlling the whole gaming market because if they do they might stick with PCs as the main gaming platform and the whole 1983/84 of gaming might happen again

  • chamber303

    Posted Feb 7, 2007 8:30 pm GMT

    okassar, you said,

    "PS3 is already doing bad and is 1-2 years away from a price drop due to tremendous loss of money per unit sold"

    this does not make any sense dude.

  • jtanga

    Posted Feb 7, 2007 8:29 pm GMT

    Xbox fanboy is really scared right now....thats the reason why they making all this comment about sony sucks....Dont worry guys time will tell.

    LOL

  • SecretWasianMan

    Posted Feb 7, 2007 8:27 pm GMT

    I couldn't agree more with jtanga. Right now the PS3's price is making people wince. But once there's a price drop I'm sure sales will spike a good amount. And Sony will end up being good ol' Sony again..... but please..... stop with the trash talk Sony.

  • chamber303

    Posted Feb 7, 2007 8:26 pm GMT

    Lots of non gamers that are only looking for a movie player have purchased a ps3 because of its blu-ray and the 1080p capable BD's
    then you have the gamers that wnt to purchase a gaming powerhouse.
    SONY is good.

  • jc_tkml

    Posted Feb 7, 2007 8:26 pm GMT

    . A lot of Europeans I've talked to are quite upset with Sony and aren't buying a PS3 and many others aren't buying it until games they like come out.

    let's see the Europeans you've talked huh you've probably met them on xbox live or unless you're a humanitarian who helps some country or just an adventurer who visits EVERY European country therefore talking to a LOT of Europeans there is no way you could have asked every Europeans that you met about ps3

    specially if the downfall of ps3's "bad luck" started from the delay which was during E3 almost a year let me calculate this 1 + 2 / 3 square root of 4 that gives you almost a year to talk to A LOT of europeans

  • okassar

    Posted Feb 7, 2007 8:21 pm GMT

    Activision owns.But I have something to say,if PS3 is already doing bad and is 1-2 years away from a price drop due to tremendous loss of money per unit sold,it's never going to do good for Sony.Even though they can make a cheaper and more efficient way to produce them,PS3 is not going to do good.I can say that a hundred times lol.If it was good,I would have bought it,I'm not cheapy-mc-cheap-cheap,but it's bad and it would just sit there if I do buy it.Activision tells the truth,and right now 360 is owning and is first priority for many gaming companies and gamers.O ya,Spider Man 3,bring it on.We need to see Venom!

  • wizardps2

    Posted Feb 7, 2007 8:19 pm GMT

    More good news to sony he he he PS3 ruels!!!

  • jtanga

    Posted Feb 7, 2007 8:16 pm GMT

    Ok Dont be hating....once sony lower the price of ps3 all i can say is DOMINATING.

  • sircrayzie

    Posted Feb 7, 2007 8:15 pm GMT

    will if the ps3 did so good and is doing so good then why 2 months into launch and you can find it everywhere. it's nice to have all these little goodies added to the console but people are starting to forget the main reason why it's called a game console because it's suppose to play games. my point to why the browser on the ps3 is useless, will let me start i have a 360 and a wii, on my wii I have to internet trail, I got it because hey it's free. and found that it's a waste of my time and I never use it anyways. it's not like slow or anything it's decent in loading times and stuff but the ease of use is not there like it is on the pc. and I'm pretty sure the ps3's browser is any different from the wii's. so come to say we don't need all these little gimicks they put in to try and drain more money from us. I have a computer I have a exspensive dvd player, so please just give me what I paid for a GAME CONSOLE. i'm still gonna buy a ps3 one day when they drop the price and put better 1 party game on the market.

  • comthitnuong

    Posted Feb 7, 2007 8:14 pm GMT

    activision seems to be doing really well. its good they are doing work with the ps3

  • Igwababa

    Posted Feb 7, 2007 8:11 pm GMT

    good for activision

  • Re_ensurer

    Posted Feb 7, 2007 8:10 pm GMT

    Hopefully it all plays out for them.

  • Aaron_130

    Posted Feb 7, 2007 8:06 pm GMT

    Activision = put your efforts into the competition, i.e; the consoles that are selling! not the PS3.

  • jknight5422

    Posted Feb 7, 2007 7:59 pm GMT

    "imagine guys u have a black box that has blu-ray player and can browser and that can connect to internet and run operating sysytems and has the cell and it the most powerful gaming machine inffront of u!! its just too good to be true!!"
    ---jackfatal

    Great. A blu-ray player with no movies. Browsing can be done
    from my PC & I can run a different OS in VMware. I thought it
    was supposed to be a gaming console? Keep wiping the
    dust off it though, it'll have a use. Some day.

  • H8s2spooge

    Posted Feb 7, 2007 7:57 pm GMT

    The ps3 sold more than the 360 ... at their "respective launches"... everyone knows this. AND HERE. http://www.psxextreme.com/feature/142.html

    Now stfu.

    ... the ps3 will offer either a price cut or bundled system in november, sooner than another system did, yet still offering more options than that, "other" system.


    Shrek the thrid huh? Should be good... for me to take a fat dump on.

  • manifestus

    Posted Feb 7, 2007 7:56 pm GMT

    Honestly, I'd love to pick up a PS3 at some point to replace the PS2 I had. But until the time comes when the PS3 actually fields some content (um ... more than Resistance: FoM) that I might actually care to play ... I'll stick with the 360. I see Sony figuring out a few things over time, throwing out some GOOD titles for the system, and generally doing better than they've been doing so far (not that they could really do much WORSE).

  • Lightchaos

    Posted Feb 7, 2007 7:53 pm GMT

    The PS3 price tag has to go down first!

  • Bigboss232

    Posted Feb 7, 2007 7:51 pm GMT

    ok activison umm yah woot hmm sony get it together lower the price of ps3 and umm yah activision

  • Trogeton

    Posted Feb 7, 2007 7:50 pm GMT

    I just cant wait till later this year till I own my ps3 that is the only thing toward the ps3 that matters to me.. forget the price drop, its well worth it

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