Activision Blizzard Announces Second-Quarter 2019 Financial Results

[btarunr]

Activision Blizzard, Inc. today announced second-quarter 2019 results. "Our second quarter results exceeded our prior outlook for both revenue and earnings per share," said Bobby Kotick, Chief Executive Officer of Activision Blizzard. "In the first half of 2019 we have prioritized investments in our key franchises and, beginning in the second half of this year our audiences will have a chance to see and experience the initial results of these efforts."

For the quarter ended June 30, 2019, Activision Blizzard's net revenues presented in accordance with GAAP were $1.40 billion, as compared with $1.64 billion for the second quarter of 2018. GAAP net revenues from digital channels were $1.09 billion. GAAP operating margin was 24%. GAAP earnings per diluted share were $0.43, as compared with $0.52 for the second quarter of 2018. For the quarter ended June 30, 2019, on a non-GAAP basis, Activision Blizzard's operating margin was 32% and earnings per diluted share were $0.53, as compared with $0.62 for the second quarter of 2018.



For the quarter ended June 30, 2019, operating cash flow was $154 million. For the trailing twelve-month period, operating cash flow was $1.86 billion.

Please refer to the tables at the back of this press release for a reconciliation of the company's GAAP and non-GAAP results.

Operating Metrics
For the quarter ended June 30, 2019, Activision Blizzard's net bookingsB were $1.21 billion, compared with $1.38 billion for the second quarter of 2018. Net bookingsB from digital channels were $1.01 billion, as compared with $1.20 billion for the second quarter of 2018.

Selected Business Highlights
Activision Blizzard outperformed our second quarter outlook, reflecting strong creative and commercial execution as we continued to reposition the business for future growth. Across Call of Duty, Candy Crush, Warcraft, Hearthstone, Overwatch, and Diablo, we are expanding our development teams so that we can accelerate the delivery of content in our pipeline, pursue new business models, broaden our communities, and delight our players.

Audience Reach

• Activision Blizzard had 327 million Monthly Active Users (MAUs)C in the quarter.
• King had 258 million MAUsC. Candy Crush franchise MAUsC grew year-over-year, driven by growth in Candy Crush Saga and the addition of Candy Crush Friends Saga.
• Activision had 37 million MAUsC. Call of Duty: Black Ops 4 MAUsC grew year-over-year versus Call of Duty: WWII, and hours played increased by more than 50%. Crash Team Racing: Nitro-Fueled enjoyed positive critical reviews and strong sales, particularly through digital channels.
• Blizzard had 32 million MAUsC. Hearthstone MAUsC grew quarter-over-quarter following the release of the Rise of Shadows expansion and The Dalaran Heist single-player Adventure. Overwatch MAUsC were relatively stable quarter-over-quarter, with engagement increasing following the release of the Workshop. Subscribers in World of Warcraft increased since mid-May, following the release date announcement and beta for World of Warcraft Classic and the Rise of Azshara content update.

Deep Engagement

• Total time spent in King's Candy Crush franchise grew strongly year-over-year.
• Total hours played in Activision's Call of Duty franchise rose double-digits year-over-year.
• Daily time spent per player in Blizzard's franchises again increased year-over-year.
• Overwatch League hours viewed continued to grow robustly year-over-year in the two stages held during the second quarter. Season-to-date, viewership and average minute audience have grown double-digits year-over-year.

Player Investment

• Activision Blizzard delivered approximately $800 million of in-game net bookingsB in the second quarter.
• King's Candy Crush was the top-grossing franchise in the U.S. mobile app stores, a lead position it has held for the last two years1.
• Advertising in the King network continued to ramp, with net bookingsB growing sequentially and doubling year-over-year.
• For Call of Duty: Black Ops 4, net bookingsB from in-game items grew year-over-year versus Call of Duty: WWII and are ahead of WWII on a comparable life-to-date basis.
• Hearthstone net bookingsB grew sequentially in Q2 following the release of Rise of Shadows and the introduction of the paid single-player Adventure, with the expansion also outperforming last Q4's Rastakhan's Rumble

Company Outlook

Currency Assumptions for 2019 Outlook:

• $1.15 USD/Euro for current outlook (vs. average of $1.12 for 2018, $1.12 for 2017, and $1.11 for 2016); and
• $1.24 USD/British Pound Sterling for current outlook (vs. average of $1.30 for 2018, $1.30 for 2017 and $1.36 for 2016).
• Note: Our financial guidance includes the forecasted impact of our FX hedging program.

Capital Allocation
The company paid a cash dividend of $0.37 per common share, up 9% year-over-year, in May 2019 to shareholders as of record at the close of business on March 28, 2019. Cash payments totaled $283 million.

View at TechPowerUp Main Site

 

[FreedomEclipse]

yeah. with as much tax dodging and evasion they do and the sheep stupid enough to keep them in business after all their bullshit practises im not at all surprised. Only Activision can declare that their games sold above expectations and made enough to build cruise liners out of money-mache and still turn around and lay off 800 staff before putting out recruitment ads for the same positions they just made available.

Activision/Bobby Kotick is the definition of the phrase 'No Shame'

Whatever happens to the company. the executives will never be the ones to suffer. All the while their games are exploiting the vulnerable.

 

[64K]

Activision Blizzard is a very profitable Publisher. Last year their net income was 1.8 billion dollars on 7.5 billion dollars in revenue.

 

[Th3pwn3r]

Maybe they should make good games again.

 

[64K]

Maybe they should make good games again.

I don't think it matters. People need their yearly Call of Duty fix.

 

[Vayra86]

Maybe they should make good games again.

Exactly. Whenever Blizzard does release something that is inhouse it is always pretty damn good, I mean even if you don't like Hearthstone and the other recent F2Ps/MTX based games, they are still the same highly polished products that still receive the same near-perfect post-sales patchsupport. And not just for five years, but decades. The recent games show similar trends, Overwatch stands out, it still receives meaty content updates and still only cost me 30 bucks ever, and its smooth as butter.

I do wonder if all that talent doesn't get fed up doing those boring, cheap tricks all the time... But then I reckon they won't mind swimming in cash either.

 

[Tartaros]

Exactly. Whenever Blizzard does release something that is inhouse it is always pretty damn good, I mean even if you don't like Hearthstone and the other recent F2Ps/MTX based games, they are still the same highly polished products that still receive the same near-perfect post-sales patchsupport. And not just for five years, but decades. The recent games show similar trends, Overwatch stands out, it still receives meaty content updates and still only cost me 30 bucks ever, and its smooth as butter.

I do wonder if all that talent doesn't get fed up doing those boring, cheap tricks all the time... But then I reckon they won't mind swimming in cash either.

About overwatch, I got mixed feelings. The game drifts in story and just focuses on trends rather than a complete universe, something it was their trademark. There were various rumors, that the Blizzard part is sick of the managers and also there was going to be an Overwatch 2 focused on pve. That gives me some hope and they don't want their games to become more weathercocks.

I'm still curious what would have become project Titan if Activision didn't butt in, even though Blizzard wasn't convinced on the results at that moment.

 

[Space Lynx]

I don't think it matters. People need their yearly Call of Duty fix.

With a new generation of kids playing Fortnite and older CoD vets having burnout on that series, I foresee CoD profits crashing very hard and very fast in next five years. Don't worry though, Kotick will make sure he gets out with a golden parachute before it all collapses. Corporate shills like him always manage to do so.

 

[my_name_is_earl]

Don't worried shared holder, we'll jack up the price of that red dot.

 

[Th3pwn3r]

Exactly. Whenever Blizzard does release something that is inhouse it is always pretty damn good, I mean even if you don't like Hearthstone and the other recent F2Ps/MTX based games, they are still the same highly polished products that still receive the same near-perfect post-sales patchsupport. And not just for five years, but decades. The recent games show similar trends, Overwatch stands out, it still receives meaty content updates and still only cost me 30 bucks ever, and its smooth as butter.

I do wonder if all that talent doesn't get fed up doing those boring, cheap tricks all the time... But then I reckon they won't mind swimming in cash either.

In my perfect world Diablo 4 comes out and is what Diablo 3 should have been. I wouldn't mind another Warcraft RTS and/or Starcraft with good story lines...

 

[Vayra86]

In my perfect world Diablo 4 comes out and is what Diablo 3 should have been. I wouldn't mind another Warcraft RTS and/or Starcraft with good story lines...

Never say never. Trends come and go but a quality experience will always be sought after, there are still many examples of that today, albeit not from Blizz

 

[Aquinus]

In my perfect world Diablo 4 comes out and is what Diablo 3 should have been. I wouldn't mind another Warcraft RTS and/or Starcraft with good story lines...

Blizzard has a lot of really good IP that they can take advantage of. I think a modern redo of Diablo 1 and 2 would be pretty awesome, just as I think a modern redo of Warcraft 1 and 2 would also be pretty awesome. There is a lot of good story and plot that they can take advantage of.

 

[Space Lynx]

Blizzard has a lot of really good IP that they can take advantage of. I think a modern redo of Diablo 1 and 2 would be pretty awesome, just as I think a modern redo of Warcraft 1 and 2 would also be pretty awesome. There is a lot of good story and plot that they can take advantage of.

I want a Warcraft 4 RTS more than anything, starting right after Archimonde's story, or an alternative story, like one of Archimonde's 'adventures' before Azeroth.

edit: actually it could start right after end of Warcraft 3 and show the rebuilding of azeroth from then to start of WoW... could have some orcs and humans clash sideline stories, etc... but all modern done but in original RTS form... mmmm I just need more of it...

 

[rere252]

With a new generation of kids playing Fortnite and older CoD vets having burnout on that series, I foresee CoD profits crashing very hard and very fast in next five years. Don't worry though, Kotick will make sure he gets out with a golden parachute before it all collapses. Corporate shills like him always manage to do so.

This years CoD has my interest for the first time in ten years. I suspect I'm not the only one of the "veterans".

 

[Space Lynx]

This years CoD has my interest for the first time in ten years. I suspect I'm not the only one of the "veterans".

you are still the minority.

 

[Aquinus]

I want a Warcraft 4 RTS more than anything, starting right after Archimonde's story, or an alternative story, like one of Archimonde's 'adventures' before Azeroth.

edit: actually it could start right after end of Warcraft 3 and show the rebuilding of azeroth from then to start of WoW... could have some orcs and humans clash sideline stories, etc... but all modern done but in original RTS form... mmmm I just need more of it...

I really think they should redo Warcraft 1 and 2 more than anything else. That part of the Warcraft story is really important for everything else that happens in the Warcraft universe. You only have so much flexibility if you pick a timeframe between two games, whereas if you do Warcraft 1 and 2 again, you open the possibility of creating a prequel story.

 

[Space Lynx]

I really think they should redo Warcraft 1 and 2 more than anything else. That part of the Warcraft story is really important for everything else that happens in the Warcraft universe. You only have so much flexibility if you pick a timeframe between two games, whereas if you do Warcraft 1 and 2 again, you open the possibility of creating a prequel story.

a re-master from the ground up using the new Warcraft 3 Reforged coding perhaps. flesh it out a bit more than the originals as well, a true re-master and full on massive campaigns. that could be pretty cool yeah, they could even throw in a few chapters in the campaign of maybe the Night Elf backstory (maybe even a chapter on magical well history, where you and other night elves at the very beginning our exploring its mysteries, then fast forward to the orcs and humans in the next chapter, back and forth or something) undead would not be allowed in lore wise, but I am ok with that. and have some dark purplish forest settings for some missions and new lore, that would be glorious!!!! the possibilities are only limited by their imagination, which is sadly very limited these days, probably due to all the Overwatch, Fortnite, and Pubg invading peoples brains, slowly lowering IQ over time. RESPAWN KILL RESPAWN KILL, what a useless adventure. I have what? 30 years left on this planet, I want unique story, atmosphere, combat, make me think baby, take me on an adventure!!! we got no time!!! Gaming was meant to be Art

 

[Aquinus]

a re-master from the ground up using the new Warcraft 3 Reforged coding perhaps. flesh it out a bit more than the originals as well, a true re-master and full on massive campaigns. that could be pretty cool yeah, they could even throw in a few chapters in the campaign of maybe the Night Elf backstory (maybe even a chapter on magical well history, where you and other night elves at the very beginning our exploring its mysteries, then fast forward to the orcs and humans in the next chapter, back and forth or something) undead would not be allowed in lore wise, but I am ok with that. and have some dark purplish forest settings for some missions and new lore, that would be glorious!!!! the possibilities are only limited by their imagination, which is sadly very limited these days, probably due to all the Overwatch, Fortnite, and Pubg invading peoples brains, slowly lowering IQ over time. RESPAWN KILL RESPAWN KILL, what a useless adventure. I have what? 30 years left on this planet, I want unique story, atmosphere, combat, make me think baby, take me on an adventure!!! we got no time!!! Gaming was meant to be Art

Since I just got Wine and DXVK working properly (outside of Proton,) I've started playing Diablo 3 through again. It's such a mindless button smashing game, but sometimes that's what I want.

FWIW, Diablo 3 runs great with DXVK and Wine 4.13 (staging).

 

[Space Lynx]

Since I just got Wine and DXVK working properly (outside of Proton,) I've started playing Diablo 3 through again. It's such a mindless button smashing game, but sometimes that's what I want.

FWIW, Diablo 3 runs great with DXVK and Wine 4.13 (staging).

I'm only going to be playing native linux games, I have plenty of backlog so not going to bother with that stuff. I enjoy Grim Dawn and Torchlight more than Diablo 3, just the unique atmosphere, and graphical design. I'm hoping to play Titan Quest at some point, as well for the unique theme of it. These clicky games can get a bit mindless though yeah

 

[Aquinus]

I'm only going to be playing native linux games, I have plenty of backlog so not going to bother with that stuff. I enjoy Grim Dawn and Torchlight more than Diablo 3, just the unique atmosphere, and graphical design. I'm hoping to play Titan Quest at some point, as well for the unique theme of it. These clicky games can get a bit mindless though yeah

After doing that for several years, I found myself missing a handful of Windows-only games.
It's actually part of the reason why I also own an Xbox One X.

 

[Tartaros]

They need at some point to comepletely redo Warcraft 2. With the movie they kinda redid Warcraft 1 with all the changes introduced in WoD, which is basically Ner'zhul is nowhere to be found for now and the overexposition for Gul'dan, not to mention the differences of characters. Even th original map of Azeroth has nothing to do with the one introduced in WoW.

 

[medi01]

Is it me, or revenue down to 1.4bn from 1.6 yoy is not really "doing great"?