Activision Blizzard Stock drops despite strong results
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Activision Blizzard
Strong results from World of Warcraft and Call of Duty titles were not enough to push
Activision Blizzard
share higher when the video game company announced its earnings.
It was as if Wall Street knew the games were good.
The Activision stock (ticker: ATVI) was down 2.5% to $ 53.20 after the market closed Thursday, adding a 3.2% loss in regular trading hours.
The company's third quarter reported adjusted revenues, or net bookings, totaling $ 1.21 billion, hitting projections requiring $ 1.17 billion. But management's forecast that net bookings will be $ 2.65 billion for the fourth quarter was short of what analysts had expected.
The company said World of Warcraft: Classic drove the largest quarterly growth in subscription history. Call of Duty: Black Ops 4 & # 39; s reach and net bookings from in-game items that lootboxes also performed far better than their third quarter predecessor.
Since Barron's noted in August that Call of Duty and World of Warcraft could push the stock higher, more analysts upgraded the stock and raised their estimates. The stock had held about 8% from August 30 until Thursday's close.
"Recent launches have allowed significant growth in the size of our audience for our Call of Duty and World of Warcraft franchise services," CEO Bobby Kotick said of the earnings release.
Kotick said that management believes that as the company introduces several free game titles based on popular franchise services, Activision can increase the size of the audience and improve engagement and revenue generation across the franchise ceilings.
"With a strong content pipeline and momentum in mobile, esports and advertising, we are confident that we will continue to be a leader in connecting and engaging the world through epic entertainment," he added.
The company said 100 million people downloaded Call of Duty Mobile in the first month, although a report from Sensor Tower in October said it hit that milestone in its first week. Call of Duty: Modern Warfare The title was released in the fourth quarter, and sales set a record last week.
Write to Connor Smith at connor.smith@barrons.com
