damn you, Treyarrrrch! this is all YOUR fault!!! kidding. not quite sure how one pulls off a loss with so much income just rolling in...
[UPDATE] Call of Duty: WAW, Guitar Hero World Tour, and Wrath of the Lich King help mint $2.3 billion in three months; megapublisher still loses $72 million but rules out "mass layoffs"; Wii DJ Hero confirmed for this year, Starcraft II beta coming in "next few months"; Modern Warfare 2 officially official.
The past several weeks have seen a steady stream of dreary financial results, with THQ, Sega, Sony, and Electronic Arts all announcing losses and layoffs. However, several companies have issued positive earnings reports, including Ubisoft, Take-Two, and Nintendo.
Today, the biggest third-party publisher of them all, Activsion Blizzard, weighed in with an earnings announcement that's both good and bad. On the one hand, the company's record $2.3 billion in October-December net revenue beat the $2.15 billion a Thomson Reuters survey of analysts had predicted. On the other, the company posted a $72 million loss during a quarter when it launched new entries in its three biggest franchises: Guitar Hero World Tour (October 26), Call of Duty: World at War (November 10), and World of Warcraft: Wrath of the Lich King (November 13).
Activision Blizzard CEO Bobby Kotick played down the loss with a backhanded dig at staff-cut-beset competitors. "We won't be distracted by layoffs and restructuring and things that other companies are going to be distracted with," Kotick told Reuters. "We don't respond to managing our operating expenses because there's a financial crisis, we do it all the time."
Despite Kotick's upbeat tone, the markets reacted swiftly and negatively. In after-hours trading, Activision Blizzard's stock was down over 5 percent, trading at $9 as of press time.
Speaking with analysts in a conference call, Activision Blizzard CFO Thomas Tippl said that the company may take advantage of the dismal economic climate to add talent to its internal roster. "A long, challenging economic environment may provide acquisition opportunities due to strong cash position," he said. According to Kotick, Activision Blizzard currently has over $3 billion in cash reserves with zero debt load.
[UPDATE] Looking ahead, Activision predicts revenues of $4.2 billion for the full 2009 calendar year (not the current fiscal year, as was initially reported). The company said that figure included $600 million in downward revisions--$400 million due to a stronger-than-expected US dollar and $200 million "from the company's lower margin distribution and the co-publishing businesses."
In a conference call with analysts, executives noted the $200 million revision was in part due to the delay of the next James Bond game. The title, rumored to be a driving-centric game from Bizarre Creations, is being pushed back into calendar year 2010 "to avoid head to head competition with Call of Duty: [Modern Warfare 2.]"
[UPDATE] Highlights from the conference call are listed below:
--DJ Hero reconfirmed as coming out in 2009 on a variety of platforms, with the Wii specifically mentioned; no price point yet.
--2009 will see a new Tony Hawk game on the Wii. It is unclear if the game will be the widely rumored skateboard-peripheral-based Tony Hawk's Adrenaline.
--Upcoming Tony Hawk again described as being radically different. "We said we would reinvent this franchise from the ground up and we've developed an interactive approach for Tony that should allow us to broaden the appeal of skateboarding beyond the core to mass market audiences," Activision Publishing president Michael Griffith told analysts. "More details later for competitive reasons."
--Yet another Guitar Hero game coming to DS. No word on whether it will use the Game Boy Advance slot, which the forthcoming DSi does not have.
--New Greatest Hits Guitar Hero games for 360, PS3, and Wii, which will feature full-band renditions of top songs from earlier, guitar-only GH titles.
--New racing game from Activision-owned Bizarre Creations confirmed by year's end. Again, no details for now "due to competitive reasons."
--Starcraft II beta test will begin "in the next few months." No launch date yet.
--Guitar Hero "installed base" now tops 32 million worldwide. Executives later clarify that this figure is the total number of Guitar Hero units sold worldwide and doesn't take into account multiple guitars and games owned by the same person or in the same household.
--Guitar Hero outsells Rock Band 4 to 1 in terms of overall series sales, say executives.
--The PS2 edition of Guitar Hero: Metallica will trail the other versions, due in March, by several months.
--Activision says its continued support of the PS2 will depend on whether Sony cuts the console's price down the line.
--Tippl admits Activision "could've done better on the cost front in terms of the launch of Guitar Hero World Tour." Says production issues raised the per-unit cost, and Activision is making adjustments to prevent the same problems occurring in the coming year.
--The sinking cost of petroleum--which is used to make the plastic in the guitars and drum kits--will also improve Activision's profit margins on Guitar Hero hardware in the coming year.
QQ more blizzard. this is what you get for trying to cash grab so hard. go and split sc2 into 3 parts so you can sell the game three times over. sure make diablo 3 look like a fixed view WoW. oh and telling us about charges for certain bnet 2 upcoming features. you wonder why people are starting to stray from you?
-The point i'm making and you obviously don't understand is that whenever blizzard releases a title other game companies clone its basic concepts, your asking me to predict the future when in fact all i was doing is drawing conclusions based on what happened in the past. Also, ill not lead you to all of the contributions they gave to RTS's and RPG/dungeon crawlers. If you do not know them then your either to young or have not played the games that mimic many of the innovations they have promoted over the years, which is fine and not meant as an insult. But ill not spend all day talking about a fact that everyone that has ever played those types of games for the past ten years already knows. SC is to RTS's in the late 90's and followng years as what DUNE and RA was to the genre in the early 90s and SC and Diablo will set standards AND trends just like bliz games always do, time we prove me correct not crystal ball predictions based on speculation.
@johngalt What sort of trend do you see Diablo 3 setting? Finding a new way to double click on a monster. It's been imitated to death and in some cases(Titan Quest) have come ridiculously close to almost surpassing it. How can games where the core gameplay concept isn't changing, be a trend? Sorry there won't be a glut of Diablo clones because it has been done to death. That would be a trend. A trend is a general direction. What exactly is the general direction of Diablo that will set the trend? I don't think the market can support many games like Diablo, so I don't see a trend at all. Perhaps you know something that I haven't read about Diablo, but it looks like a shinier version of what we have already played.
@nintendokid I hate to break it to you but South Korea does not set the benchmark for the rest of the world in gaming. South Korea also has a rabid Lineage II following but does that mean it will be an international success being played ten years from now? I just see way more innovation in DOW than SC. I didn't say SC was going to be terrible, just looks really dumbed down for an RTS being released in 2009. Which is fine if you just want to recreate your original SC experience. When Starcraft was released it did revolutionize RTS gaming. Check citation #7 on the wikipedia article on SC. So actually their is merit to my original comment about SC setting the standard for RTS's when it was released. There wasn't a RTS that looked as good as SC available at that time, so your point about not being flashy isn't true. It was the best graphically and play wise. I just figured they would try to set some new benchmarks with the amount of time this game has been in production. I have advanced my RTS tastes and want to be more involved tactically(it would be nice if there were more than three races) than what it looks like SC will offer. And I have been playing the DOW franchise for fours years, and will continue to play it into the future unless something else upstages it. The fluff is way more interesting and the sheer number of races you can play versus what you get in SC doesn't even compare. So I think people will be playing DOW in ten years. Maybe not in South Korea because we all know that South Korea is a bubble as far as gaming goes. Obviously..uh Lineage II. Nuff said. I appreciate peoples rabid devotion to SC, I just don't think it is going to be as big some people think. Many people have moved on to bigger and better things and for many this just might be a brief trip down memory lane. Nothing to get too excited about. Once again sales will determine that, not our opinions.
How the hell did they manage to lose money? They have WoW! Some 4 million people bought WoTLK, and let's not forget the 150 million bucks they get from subscriptions every month...
"We don't respond to managing our operating expenses because there's a financial crisis, we do it all the time." - Christ almighty, a company that has their head screwed on! I always thought the games industry would be the only ones acting sensibly during these 'harsh' economic times.
Most times when a company releases a expansion that is the best selling expansion of all time would gain a profit in the Quarter. But this is not the case
While there are quite a few very very exciting titles to come from Activision-Blizzard (I won't name them for obvious competitive reasons :-))), I still see a few bets that I cannot dig into: - Guitar Hero game coming to DS (it is really a crap experience and did nto seem to sell well - why do it again?) - DJ Hero (I do not see this appealing to the masses) - Tony Hawk (not my type) Shouldb't Blizzard's influence on the "big" Activision strategists show by re-orienting their resources to more successful projects of excellence? Am I the only one under this impression?
YES YES YES YES ! Starcraft 2 beta arriving ! Also yes i might've had bought a guitar hero game if it was coming to PC (Guitar Hero:Metallica !) Good job Bliz.
Fact: Starcraft 2:WOL and its expansions will make ANY Warhammer game look like a badly ported rip off of the board game version of "Candy Land". FACT 2: Starcraft and Diablo will set trends for the next 5 years for their particular genres.
@Cabal23 Your criticism is not valid. Starcraft (1) never was considered to be innovative. It just did everything right. Starcraft 2 will also not be revolutionary or innovative. Blizzard has already stated that they intend to keep things roughly the same and tweak everything closer to perfection. In terms of "screenshots don't compare", even in 1998 when Starcraft was released, it was anything but flashy. Again, your criticism is not valid. Blizzard never claimed they are out to make the next best-looking RTS. "Dawn of War will smoke anything Blizzard has up their sleeves..." You are entitled to your opinion. But 10 years from now, will millions of people still be playing Dawn of War? I highly doubt it. South Korea as a nation treats Starcraft like the NFL. Enough said.
It would be cool if this loss was a direct result of all those stupid cuts they made from their Vivendi lineup.
Maybe they will respond by trying to pull all their non-Blizzard franchises out of mediocrity and taking some chances with new IP's. Or maybe they will do the same thing they did when they merged and waste our time with lazy sequels while dropping all of their creative new IP's (Ghostbusters and Brutal Legend come to mind)..
Maybe the whole Blizzard/Activision merger wasn't such a good idea. I wonder if anyone at Blizzard is sweating now that they are roped into riding out the storm with Activision on board? I hope Blizzard/Activision has more than an old played out RTS to hopefully boost sales. Starcraft will not be the end all be all that it was when it first came out. I hate to frown on one of my favorite game companies, but the new Dawn of War will smoke anything Blizzard has up their sleeves. The screenshots don't even compare. We shall lets sales determine, but I have yet to hear or see any sort of innovation with Starcraft II.
Blizzard know's what they are doing and many of us will wait for their games to be launched beta will be crazy thanks a lot for the info GS.
earththecanniabl, Blizzard is the slowest company in gaming, but they have good reason for it. Their games are always excellent, and well recieved. They have been known to completely scrap a game if it doesn't meat their specs, or completely start it over (which is what theydid with Starcraft). One of the few companies that actually listens to consumers complaints. So you can say what you want about Blizzard, but if you're going to deny their one of the greatest industries in the business...you're just wrong.
Blizzard is dead to me ...slowest company in the entire gaming world. And please don't give me the line "it takes 10-15 years to make a good game"... either.
I'm with CasinoOutlaw, COD:MW2 is going to make them a fortune, and then another fortune in DLC. IF they had the brains to make a Tony Hawk game that wasn't some absurdly broken carnival, they'd make another mint.
don't know why they'd want the PS2 to drop in price in order to continue to support it, currently the PS2 has the largest user base out of any console ever.. with 140 million systems sold worldwide and still growing why wouldn't you continue to support it?
What I like about Blizzard is that they don't rush out games by a deadline, they get them done when they are perfected. I strongly doubt a Christmas release for Starcraft II.
--Starcraft II beta test will begin "in the next few months." No launch date yet. Will it make it for Christmas? Maybe not, given I doubt Blizzard will rush the beta-testing. :/
--Call of Duty: Modern Warfare 2 is now officially official. THAT is music to my ears. The fact that Infinity Ward is doing it that should more than make up for the $72 million loss and I'm glad IW is doing the next in the series. Say goodbye to guitar hero and while we're at it enough with the tony hawk games too!
I think that they companies need to stop making a sequel to a game ever year, and just make 1 awesome game every couple of years. We do not need another COD next fall, no more guitar hero, and i dont know how blizzard doesnt have more money when you have to pay to buy WOW, then pay every month to play it, and there is like 11million people playing, what is that like, 165mill every month they bring in, come on......
I think everyboby is jumping on the Bandwagon so they have an excuse to layoff or fire pepole so the companies can make more money for them self's. Consumer products cost to much! My pay does not even out with the so called "Cost of Living".
I thought the new Wolfestein was coming out for PS3 too!!! My brother is going to be mad about that!!!
activision is a good company, they make really good games (mostly) almost all of their original IPs are very good until they go past their 6th installment (COD seems to have bucked that trend). Blizzard makes good games but they aren't for everyone. starcraft II and WOW is basically their company right now. and wow may get old to many, especially the hardcore who have found it too easy for their tastes and too expensive for their liking. starcraft 2 will most likely be amazing but i'm not convinced it will revolutionize the genre as the first one had. all in all these are two very powerful companies with very powerful ideas, it's amazing they aren't losing more with the current financial situation Here's to the company continuing to make good games
I wonder on what are expending the money they gain to report a "loss". This is not "strange", this is bad administration. I love the COD series, but I donīt like a bad managment that could put the franchise in risk.
I know this might sound stupid on the US (where every gamer owns at least one current gen game console) but I'd love to see Guitar Hero World Tour on the PC... :(
I think they are trying to avoid the fact that Blizzard is making half of Bliz/Activision revenue. Mmmm, Activisions many games compared to Blizzards small handfull?
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