Activision quarterly sales drop 18%

Call of Duty publisher gets 59% of revenues for the quarter from digital sales; Diablo III tops 14 million sold

Activision followed up its annual Call of Duty victory lap this morning with the release of its quarterly results for the three months ended September 30, and they were not quite as victorious.

While the publisher beat its outlook, Activision's third quarter revenues were down 18 percent to $691 million. The company's bottom line also took a hit, as profits dropped 75 percent year-over-year to $56 million.

In the company's post-earnings conference call, Activision executives pointed to tough comparisons against the same quarter last year, when the World of Warcraft: Mists of Panderia expansion launched and Diablo III enjoyed its first full quarter on sale. World of Warcraft has seen continuing declines since then, with subscribers dropping from 10 million in the wake of the Mists of Panderia release to 7.6 million at the end of the most recent quarter. However, the decline has slowed, with the game losing just 100,000 subscribers in the last three months. As for Diablo III, Blizzard's Mike Morhaime said the call that the game has now sold 14 million copies.

One highlight was Activision's digital business, which accounted for 59 percent of the publisher's revenues for the quarter, a record for the third quarter.

"We continue to believe that the fourth quarter this year presents a unique and challenging landscape due to increased competition and uncertainties surrounding the console transition," Activision CEO Bobby Kotick said in a statement. "We are confident in our ability to navigate these challenges successfully, particularly in light of the recent completion of our transaction with Vivendi and the focus and flexibility provided by our return to independence."

Activision also raised its full-year forecast from $4.31 billion to $4.32 billion, with an earnings per share up to $0.83 from a range of $0.80 to $0.82.

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Latest comments (3)

Rick Lopez Illustrator, Graphic Designer 4 years ago
Activision quarterly sales drop 18%, Yet makes 1billion in 24 hours of COD sales that arent even in consumers hands... Im not sure what to believe anymore.
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Anthony Chan4 years ago
The headline again is misleading. Quarter over Quarter they have dropped 18%, but taking a look at their schedule; it appears they had a light release quarter. In addition, Q1 saw some extremely significant releases SCII:HoTS and D3. Q2 was a bit quieter and probably just leading with the sales from D3 and Skylanders. Q3 saw no major game release (B Ops II DLC and D3 console - which we know as not stellar) - hence the drop in sales. Companies are expected to have ebb and flows in sales especially in retail.

However their Q4 should be a blast, which is great because this is the quarter all investors look to. The expectation from investors is that they be able to capitalize on the holiday season, its like free money. Q4 we're going to see their final figures for COD Ghosts for BOTH generations of console, Skylander Swap Force, and Angry Birds Star Wars.

That should be a quarter to reckon with.
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Klaus Preisinger Freelance Writing 4 years ago

The impact of that billion would be in an upcoming quarterly report, not this one.
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