Activision Blizzard Says It Will Beat Q1 Forecast; Reups China Warcraft License
This story was written by Rory Maher.
In what is perhaps the first earnings surprise of this season Activision (NSDQ: ATVI) Blizzard announced this morning that it would beat its first-quarter 2009 forecast issued only two months ago. That forecast was for $860 million in net revenues and earnings per diluted share of $0.08 (according to American accounting rules). CEO Robert Kotick said the results were driven by better-than-expected sales from its franchise titles Call of Duty, Guitar Hero and World of Warcraft games. The company did not, however, increase its full-year 2009 forecast, also issued in February, which is probably more a function of the shaky economy than any cue that the company expects demand for its games to soften.
Also this morning, Activision Blizzard subsidiary Blizzard Entertainment said it had renewed its agreement with Chinese internet operator NetEase to license its World of Warcraft game for an additional three years. Blizzard also licenses StarCraft 2 and Battle.net to NetEase, but those licenses have yet to expire. Warcraft has been a huge success for Blizzard in China, where users pay per session to play the game and can play anywhere they can access the internet.
Chinese gaming companies have been on a tear of late with Tencent announcing strong earnings results earlier this year and Changyou going public in a successful IPO.
By Rory Maher