Activision Forecasts Quarterly Profit That Tops EstimatesCliff Edwards
Activision Blizzard Inc., the largest U.S. video-game publisher, forecast third-quarter profit that topped analysts’ estimates a week after it announced a deal to buy most of Vivendi SA’s stake in the company.
Earnings excluding some items may be 3 cents a share on revenue of $585 million, for the three months ending Sept. 30, the Santa Monica, California-based company said in a statement today. That exceeds the average analyst projection for profit of 2 cents a share and sales of $580.1 million excluding items, according to data compiled by Bloomberg. Activision announced its second-quarter earnings on July 25 with the stake purchase.
An investor group led by Chief Executive Officer Bobby Kotick plans to buy most of Vivendi’s stake for $8.17 billion, leaving the French media and telecommunications company with a 12 percent holding. The maker of hit titles “Call of Duty” and “World of Warcraft” has weathered an industry decline as players have moved to mobile and digital games on the strength of its shooter games and “Skylanders,” which marries a video game with collectible figures.
“Our solid performance across our franchises and strong digital sales, including continued significant growth this quarter in our ‘Call of Duty’ downloadable content business over the previous year, validate our belief that we will enter this new period of independence in a position to leverage the flexibility and focus that it provides,’’ Kotick said in today’s statement.
Net income in the second quarter rose 75 percent to $324 million, or 28 cents a share. Sales fell to $1.05 billion from $1.08 billion.
For the full year, the company forecast sales of $4.31 billion, up from a projection of $4.22 billion in May. Activision sees earnings excluding items of $1.01 to $1.09 a share for 2013, up from its earlier view of 82 cents. The earnings forecast is on a pro forma basis excluding the impact of the stake purchase from Vivendi.
Activision slipped 2 percent to $17.83 in extended trading at 5:59 p.m. New York time. The shares gained 1.2 percent to $18.20 at the close and have advanced 71 percent this year.