from

http://online.wsj.com/article/BT-CO-20110509-716588.html

SAN FRANCISCO (Dow Jones)--Activision Blizzard Inc.'s (ATVI) first-quarter profit jumped 32% as digital sales surged amid continuing popularity of its "Call of Duty" and "World of Warcraft" franchises.

The Santa Monica, Calif.-based company raised its full-year outlook to an adjusted 73 cents in earnings per share on revenue of $3.95 billion, up from the February targets of 70 cents and $3.9 billion, respectively.

Chief Executive Robert Kotick said Activision has not been materially affected by a nearly three-week outage of Sony Corp.'s (SNE, 6758.TO) PlayStation Network that has raised questions about the security and reliability of online services. Last month, Sony took its network offline following a security breach that compromised 77 million customer accounts, leaving customers unable to play games together over the Internet.

Kotick said games like World of Warcraft, which require a monthly subscription payment, have created stable and growing revenue streams for Activision. He added that Activision's investments this year will mostly focus on the company's popular franchises and higher-margin online products.

"We're still scratching the surface of the role digital delivery will play in our products and services," Kotick said.

Activision's better-than-expected results stand in contrast to the broader videogame industry, which has struggled to capture customer attention as consumers embrace cheaper games made for smartphones, tablets and popular websites such as Facebook. Activision, by comparison, has produced some of the most popular titles in the industry, attracting customers who regularly replay its games online and buy additional content packs in droves.

For the latest quarter, Activision reported a profit of $503 million, or 42 cents a share, up from $381 million, or 30 cents a share, a year earlier. Excluding the impact of deferred sales, stock-based compensation and other impacts, adjusted earnings rose to 13 cents from 9 cents.

Total revenue jumped 11% to $1.45 billion. On an adjusted basis, which excludes the impact of the change in deferred sales, revenue climbed 5.7% to $755 million.

In February, the company projected adjusted earnings of about 7 cents a share and fully-reported revenue of $1.28 billion.

For the current quarter, the company expects earnings of 4 cents on revenue of $575 million, compared with the 8 cents and $661 million predications by analysts polled by Thomson Reuters.

Operating margin grew to 46.5% from 39.1%.

Product sales increased 7.6% to $1.06 billion, while subscription, licensing and other revenue grew 20% to $388 million.

Activision's shares were up 0.6%, to $11.61 in after-hours trades, after closing up nearly 1%.

-By Ian Sherr, Dow Jones Newswires; 415-439-6455; ian.sherr@dowjones.com

--John Kell contributed to this article.


Quasi, it isn't about whether they count "cancelled" subs or not, it's about the fact that it simply doesn't matter !!

 

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Haha! Indeed.

 

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HOLY CRAP.

 

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http://www.vivendi.com/vivendi/IMG/pdf/2011_05_12_financial_report_financial_statements_Q1_2011.pdf


I read through their first quarter report and I saw, no kidding, only one mention of World of Warcraft. And they lumped it in with other games when they mentioned it. They were mainly bragging about their Xbox expansion pack downloads. I didn't see that much in the way of impressive WoW love in this report. Please correct me if I am wrong.

 

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I guess when you dont have much in the way of expenses (ie production of hard copy materials) and do a lot of digital downloads, this is what happens. Digital downloads are the way to go since you can still charge the same amount for a product that some schlep bought at the store in hard copy.


They may also be getting away with not paying state sales tax too with DD. That would definitely increase operating margin.

 

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Black OPs baby, I'm pretty sure it is the highest selling title of all time. At least since they started keeping precise records (though I'm sure it is). With WoW also bringing in the dough and other titles doing pretty good in their own right, DLC add-ons and map packs, etc, yea, not a surprise that the biggest publisher made big money.

 

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I thought the Sims was way and beyond the reach of anything for that record.

COD:BO may have been the fastest in a release timeframe, but hardly the highest selling title of all time.

 

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As soon as I finished the first mission in Black Ops I was like, wow, this game sucks worse than I imagined.

 

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Hmm, I've found a few articles citing NPD claims that it is the best selling US game of all time, so I suppose that's where I heard it. Not sure if that's just for consoles, too lazy to keep googling.

 

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