Activision Blizzard just reported third quarter results. The company met its own expectations, but was too short compared to Wall Street expectations. This has turned the company's stock into a small tail. But it seems like there is a savior waiting. Call of Duty: Black Ops 4 launched on October 12th and it is a sales juggernaut.
As part of the earnings report, Activision described the current performance of Call of Duty. The modern military shooter has sold more copies than Black Ops III in the first three weeks. Much of this sales comes from the Battle.net service from PC and Blizzard. According to Activision, Black Ops 4 sales are three times higher than Black Ops III.
This makes this game one of the best-selling Call of Duty games ever. And it has certainly surpassed Advance Warfare and World War II, the two youngest predecessors, in the first three weeks.
The publisher also announces his engagement numbers. Active users have increased 1
Activision has a weak outlook despite Black Ops 4
. But while Call of Duty is ready to deliver some big numbers to Activision for Activision in the fourth quarter, the publisher has no high overall expectations. While a consensus among Wall Street analysts predicted that the company would predict earnings per share of $ 2.64 for fiscal year 2018, the company announced a $ 2.46 outlook and earnings per share ,
For the fourth quarter, it was even grimmer. Analysts' consensus was $ 1.34 a share for the next quarter, but Activision expects earnings per share to be as low as $ 1.27.
Following this conservative outlook, the company's share price in the post-exchange business fell by 10 percent. At the time of writing, the stock was quoted at $ 56.50 per share.
However, in a statement to investors, Bobby Kotick, Chief Executive Officer of Activision, remained optimistic.
"Activision Blizzard's Results for Q3 Surpassed Our Past Prospects We continue to strive to engage a wide audience, drive deep engagement, and generate substantial investment in our franchises," said Kotick. "Our unique advantage remains our ability to create the most compelling interactive and viewer entertainment based on our own franchise, combined with our direct digital connection to hundreds of millions of customers in over 190 countries. With these competitive advantages, we continue to connect the world through epic entertainment.
Activision is also about "epic" business models. Last week, Treyarch activated the micro-transactions for Black Ops 4 in the game last week. If this digital game product generates significant revenue, Activision can easily exceed expectations for the fourth quarter. And we'll see what happens to the stock price when the company reports results for the 2018 fiscal year.
Why so low?
But if Call of Duty is so strong, why does Activision have such a bleak outlook for the fourth quarter? The answer is a combination of expectations and Destiny 2. For the first company, the company is not yet sure how much its Black Black Blackout (BOBO) RIGHT mode will monetize. If gamers get used to spending a ton of money, this could be a huge source of revenue. But the company will not rely on it and then fail. It's better to go down and exceed those expectations. The investors respond best to that.
For the former, Destiny is an example of a game that does not generate enough money – and that's Activision.
Good as we like, "said Kotick during a conference call with investors.
Developer Bungie launched Destiny 2: Forsaken on September 4, and fans have responded positively to the new content, yet Destiny does not deliver What counts for Activision, and you can see how the publisher is trying to counteract this by giving away the base Destiny 2 on the PC to anyone with a Battle.net account for free and the game has also been brought to PlayStation Plus for free The hope is that more people will come in and start investing.
We'll probably get a better idea of whether this will work for the next report coming out of the holidays Return to BOBO
Corrected at 16:49 to reflect the correct numbers for Q3 and Q4.