© Reuters Activision Blizzard (ATVI): Call of Duty strength fuel earnings beat
By Senad Karaahmetovic
Activision Blizzard (NASDAQ:) posted fourth-quarter results that came ahead of estimates as investors continue to focus on the regulatory aspect of the game maker’s pending sale to Microsoft (NASDAQ:).
ATVI Q4 earnings per share of $1.87, easily above the consensus for $1.51 a share. Net revenue increased by nearly 8% year-over-year to $2.33 billion while net bookings came in at $3.57B, again topping the consensus of $3.19B.
“We ended 2022 with record quarterly net bookings as we delivered on our mission to bring epic joy to players,” ATVI said.
For the first quarter, Activision said it expects at least high-teens YoY growth for GAAP revenue, and at least mid-teens YoY growth for net bookings. On the Microsoft deal, the company said:
“The two parties are continuing to engage with regulators reviewing the transaction and are working toward closing it in Microsoft’s fiscal year ending June 30, 2023, subject to obtaining required regulatory approvals and satisfaction of other customary closing conditions.”
Stifel analysts reiterated their view position that ATVI’s sale to Microsoft will eventually go through. On the financial results, the analysts added:
“Activision was clearly stronger in the content cycle relative to its peers, but the outperformance also demonstrates that quality games can play well, even in this economy.”
Goldman Sachs analysts said that Call of Duty strength fueled the beat.
“Call of Duty: Modern Warfare II set a record in terms of opening-quarter sell-through for the franchise. Blizzard’s net bookings continued to grow, driven by Warcraft and by reinvigoration efforts across Overwatch and Diablo. King’s Candy Crush delivered record performance, supporting overall ATVI mobile platform net bookings growth of +mid-teens% YoY,” they wrote in a note.
Activision Blizzard stock is up over 2% in pre-open Tuesday.