Tallahassee Journal

Activision shares fall as revenue misses expectations

Activision shares fall as revenue misses expectations

Shares of video game maker Activision shares fell 7% in after-hours trading Thursday after the company reported fourth-quarter revenue that fell short of expectations. Revenue for the quarter that ended Dec. 31, 2014 was $2.21 billion, just better than Activision’s own forecast of $2.2 billion. However, the figure fell below analysts’ estimates of $2.24 billion and the company’s fourth quarter 2013 revenue of $2.27 billion.635587519084716929-Screenshot-7V

Shares fell 7% to $20.25 in after-hours trading. Adjusted earnings per share of 94 cents beat estimates of 88 cents. Net income for the quarter of $361 million beat fourth-quarter 2013′s $174 million mark. However, net income for the year fell 17% from $1.01 billion to $835 million in 2014.

Activision Publishing finished 2014 as the No. 1 video game publisher in the U.S. with three of the top five new releases: Call of Duty: Advanced Warfare (No.1), Destiny (No. 3), and Skylanders Trap Team (No. 5). Activision Blizzard CEO Bobby Kotick noted that the quarterly earnings were a new record and digital revenues were an all-time high of 46% of total non-GAAP revenues. “”We expanded our franchise portfolio by launching two of the industry’s most successful new brands, Blizzard’s Hearthstone: Heroes of Warcraft, and the biggest new IP launch in industry history, Destiny,” he said in a statement. “Combined, these franchises attracted over 40 million registered players worldwide and generated more than $850 million in non‐GAAP revenue.”

Fourth-quarter sales of $1.575 billion surpassed last year’s sales of $1.518 billion, but total 2014 sales were down slightly, $4.4 billion, compared to $4.6 billion in 2013. The Call of Duty franchise revenues surpassed $11 billion globally with the sales of COD: Advanced Warfare; the franchise was the No. 1 game in North America for the sixth consecutive year.