Activision Blizzard – 2019 Q2 Earnings

Okay, I didn’t get a chance to listen to the whole call. In fact, I missed most of it. You can find the recorded call, the slideshow, and a financial spreadsheet here. Feel free to double-check any and everything because I’m working primarily off the slideshow. There wasn’t a whole lot I thought was particularly interesting. That said, I’m not really a very active player of their products.

This is the obligatory “I don’t own any shares in this company” statement. Too rich for my blood, as they say.

I was honestly more interested in what they didn’t say, or how they phrased it, than what they actually said. In the grand scheme of things, this is a slam dunk of a financial report. They had pretty conservative guidance for Q2 and they exceeded that by a good bit. Investors seem to love it when a company “does better than it thought it would.”

Having said that, net revenue, operating income, and earnings per share are all down compared to last year. Just not as down as they expected it to be.

All of their monthly active users are reported as increasing or steady year over year, except WoW. They have a much more cagey “increased since mid-May” thing to say about that, though I don’t think it’s fair to compare the pre-expansion period last year to the mid-expansion position they’re in now. I’m fairly confident that’s why they didn’t issue a similar statement.

In the same fashion, King and CoD time spent are reported as “total time spent” which is growing for each title. Blizzard has a more predictable increase in “time spent per player.” As an MMO player, that seems fairly normal. One way to make that number go up is to lower the number of active players, which is probably a bit low in the pre-patch Q2. I suspect the Q3 will show a more positive WoW report.

I did find it interesting that they also reported viewtime for Overwatch League and CoD World League. Naturally, those numbers are up and increasing year over year. I imagine the current climate towards video games and violence, as well as ESPN dropping Apex Legends, may slow that down just a bit.

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Looking at the data in the financial spreadsheet though, it’s important to note that the company as a whole has been, and continues to, operate at a profit. Even broken out into Activision, Blizzard, and King, every segment is currently pulling a profit. They aren’t “losing money.” At least not yet.

There does seem to be a downward trend for Activision and Blizzard over the last few years while King has held pretty steady. I’ve been under the impression that the games industry as a whole is kinda down right now, so that’s to be expected.

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I find it particularly interesting that the platform that has taken the hardest hit is PC, though both it and console seem pretty volatile and both appear to be down compared to Q2 in other years.

Either way, time will tell I guess. Y’all take care, and remember not to put all your eggs in one basket.


BlaugustBOnlylogoIn case you haven’t heard, we’re in the middle of an event called Blaugust. The goal is to simply promote and stimulate the blogging community by encouraging people of all skill levels and backgrounds to post. The official post can be found here and it’s never too late to start.

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