Records-shattering release of ‘Overwatch’ leads big quarter for Activision Blizzard
With more than 15 million players and 500 million hours played, the record-shattering release of team shooting game “Overwatch” lifted Activision Blizzard Inc. to its best ever second-quarter sales.
“Overwatch” is on its way to being the Santa Monica video game maker’s most successful launch ever, with digital purchasing and a blossoming player base in Asia contributing to fast-paced pickup. No game from the company’s Blizzard Entertainment division has reached 15 million players as fast, executives said. Chief Financial Officer Dennis Durkin called it a “resounding start.”
Increased sales of digital content for “Call of Duty” and virtual items in “Candy Crush” also boosted financial results for the April-through-June period. As did reignited interest in “World of Warcraft,” ahead of new content for the game coming this month and as Chinese consumers flocked to a movie tied to the franchise.
Revenue in the second quarter hit $1.57 billion, up 50% from the same quarter last year, Activision Blizzard announced Thursday. Profit was $127 million, or 17 cents a share, down about 40% from $212 million last year. The company attributed the decline to costs from its absorption of mobile game developer King Digital Entertainment. The earnings results still topped consensus estimates among financial analysts.
“Overwatch” has brought in $500 million in revenue to date. And it’s the new kid in the portfolio that made the largest waves last quarter after its official release in May. Millions of players tested the game before the launch, and positive reviews seem to have driven many more to get into its six-on-six matches.
“Overwatch” widely displaced Riot Games “League of Legends” as the most popular game in South Korean Internet cafes — a popular hangout for gamers there — Activision Blizzard said, citing data from research firm Gametrics. The title emerged as the fastest-selling PC game ever in China, and a Reddit message board for “Overwatch” became the fastest-growing one on the online forum. Videos of “Overwatch” action and discussions are among the most-viewed gaming videos on services Twitch and YouTube.
All the new players gave Blizzard Entertainment a record 33 million monthly active users in the quarter, up 13% from a year earlier (people who play more than one game, or play on different devices, are counted multiple times). The Activision Publishing division had 49 million monthly users, up 11%. King added 409 million monthly players, down slightly, the company said, because smartphone and tablet gaming usually drops in spring.
Overall, players spent a quarterly record $900 million on content and virtual items in the game.
Shares of Activision Blizzard rose nearly 1% in late-trading immediately after the earnings release, going up above $41.
Activision Blizzard said it expects $1.49 billion in revenue in the current quarter and earnings of 6 cents a share.
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