Activision Announces Record Financial Results Driven by Success of Overwatch, WoW: Legion and More

on November 3, 2016 4:13 PM

Today Activision Blizzard announced “better than expected” and “record” financial results for the third quarter of calendar year 2016. Related to the period between July 1st and September 30th, 2017.

The accompanying press release included a few bullet points about the performance of the company and of its games, highlighting the performance of Overweatch, World of Warcraft‘s expansion Legion and more.

Audience Reach

  • Activision Blizzard had 482 million Monthly Active Users (MAUs)A in the quarter.
  • Blizzard had the biggest quarterly online player community in its history, with 42 million MAUsA, up 25% quarter-over-quarter and 50% year-over-year. This reflects the continued success of Overwatch® and the launch of World of Warcraft®: Legion™. Blizzard has more than doubled its MAUsA in just two years.
  • On August 30, 2016, Blizzard launched World of Warcraft: Legion, which sold-through 3.3 million copies on day one, matching all-time records achieved by previous expansions, and ranking amongst the fastest-selling PC games ever. The new expansion grew franchise MAUsA by nearly 30% quarter-over-quarter.
  • Overwatch became Blizzard’s fastest game ever to reach over 20 million players globally, with a roughly even player base split between east and west. Overwatch also held the number one position in share of play time in Korean Internet Game Rooms from launch all the way through the third-quarter.1
  • Blizzard’s Hearthstone®: Heroes of Warcraft™ had record quarterly MAUsA, which grew a double-digit percentage year-over-year.
  • Activision had the biggest third quarter online player community in its history with 46 million MAUsA. Over the last two years, Activision has grown its MAUsA by 18%. Activision continues to have four of the top ten games on current-generation consoles life-to-date, including Call of Duty®: Black Ops III at No. 1.2 The Call of Duty franchise reached record third quarter MAUsA.
  • On September 20, 2016, Activision and Bungie released Rise of Iron, a large new expansion for the Destiny universe. The expansion included fresh new content in the form of a new location, a new Raid, a new Strike, additional quests, gear, and a new game mode, which drove an increase in MAUsA quarter-over-quarter.
  • King MAUsA of 394 million were down slightly this quarter. King had three of the top-20-grossing titles in the U.S. mobile app stores for the eleventh quarter in a row.3

Deep Engagement

  • Activision Blizzard’s compelling in-game experiences drove over 10 billion hours of play time during the third-quarter.
  • Blizzard had all-time engagement records with record weekly and daily active users, unique users and play time, driven by an expanding player base and strong engagement across a number of franchises.
  • In September, Blizzard released the World of Warcraft: Legion Companion App, and for the first time ever, players can engage with select in-game activities and continue gameplay even when away from their PCs. Millions of players have already used the app and are logging in an average of 4 to 5 times every day.
  • King’s time spent per MAUA was up year-over-year.
  • Activision Blizzard’s esports network, Major League Gaming, in partnership with Facebook, recorded about 50 million views, growing 67% quarter-over-quarter4. At peak, a record 11 million users were reached in a single day4.
  • From September 2 through 4, 2016, Activision hosted Call of Duty XP, its largest fan event ever which included the culmination of the Call of Duty World League Championship, presented by PlayStation® 4. More than 1,000 teams participated in the Call of Duty World League during the 2016 season, which recorded 121 million views.

Player Investment

  • Activision Blizzard GAAP revenues from in-game content reached records of nearly $1 billion this quarter.
  • Blizzard’s World of Warcraft: Legion expansion drove record monthly participation in value-added services.
  • Summer Games content for Blizzard’s Overwatch drove record engagement and participation in in-game customization items.
  • On August 11th, 2016, Blizzard launched One Night in Karazhan™, a new Adventure for Hearthstone: Heroes of Warcraft, which performed even better than its predecessor.
  • King’s overall mobile gross bookingsB and average revenue per paying user increased year-over-year. In addition, gross bookingsB for King’s Candy Crush™ franchise grew year-over-year, and King’s Farm Heroes™ franchise increased mobile gross bookingsB quarter-over-quarter and year-over-year.
  • Activision’s Call of Duty continues to deliver record performance. The number of in-game content purchasers in Call of Duty more than doubled year-to-date and, along with robust participation in Season Pass and a-la-carte map packs, drove an increase in average revenue per user as well.

Company Outlook:

  • On October 5, 2016, Activision launched the Call of Duty: Modern Warfare® Remastered campaign mode for pre-purchasers of Legacy or Digital Deluxe Editions on PlayStation 4 console systems 30 days in advance of the broader launch. On November 4, 2016, Activision is expected to launch the highly anticipated Call of Duty: Infinite Warfare™.
  • On October 11, 2016, Blizzard launched its Halloween Terror event for Overwatch. The event included Overwatch’s first-ever player versus environment game mode and a variety of new Halloween-themed customization items. The event drove even higher engagement and participation than the Summer Games event.
  • On October 12, 2016, King launched Shuffle Cats™, a free-to-play live multiplayer card game set in the 1920s. The title is available on the Apple App Store, Google Play, and Facebook.
  • On October 16, 2016, Activision released Skylanders®: Imaginators, and for the first time in toys-to-life history, fans are able to create their own digital Skylanders from scratch. On October 28, 2016, Activision Blizzard Studios, in partnership with Netflix, debuted Skylanders Academy, a new TV series celebrating the beloved kids franchise.
  • On October 18, 2016, CBS, in collaboration with King and Lionsgate Television, announced Candy Crush, a new one-hour live action game show, based on the world-renowned mobile franchise.
  • Blizzard’s tenth BlizzCon® will be returning to the Anaheim Convention Center this Friday, November 4, and Saturday, November 5. Thousands of tickets again sold out in a matter of minutes, but millions more will be able to join through live-streaming or virtual tickets. BlizzCon will feature a number of events including the finals of several Blizzard esports tournaments, with global champions across a number of franchises crowned.
  • From December 16 through December 18, 2016, Major League Gaming will host its first MLG Vegas event, an esports and digital culture festival at the Mandalay Bay in Las Vegas. The 3 day event will feature the first competition of the Call of Duty World League 2017 and an Overwatch Invitational.
  • Based on its year-to-date results, Activision Blizzard is raising its full-year net revenues and earnings per share outlook. The company’s fourth-quarter and full-year net revenues and earnings per share outlook are as follows:

Chief Executive Officer Bobby Kotick also made a statement about the company’s performance in the quarter.

“This quarter we again over-performed our plan, delivering record third-quarter revenues of $1.57 billion, up almost 60% and earnings per share of $0.49, more than doubling year-over-year on a non-GAAP basis (as redefined).”

“We continue to see enthusiasm from our global audiences for our key franchises including Call of Duty, Destiny, Candy Crush and World of Warcraft, plus our newest franchise – Overwatch, which after only about four months had already reached over 20 million players and has incredible player engagement. Looking forward, we expect continued momentum from all of our growth strategies, especially our esports initiatives and our integration of in-game advertising.”

Last but not least, we get a breakdown of the company’s results by platform family, with PC leading the latest quarter (probably due to the launch of World of Warcraft‘s expansion Legion), but consoles leading the past nine months.

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 /  Executive News Editor
Hailing from sunny (not as much as people think) Italy and long standing gamer since the age of Mattel Intellivision and Sinclair ZX Spectrum. Definitely a multi-platform gamer, he still holds the old dear PC nearest to his heart, while not disregarding any console on the market. RPGs (of any nationality) and MMORPGs are his daily bread, but he enjoys almost every other genre, prominently racing simulators, action and sandbox games. He is also one of the few surviving fans of the flight simulator genre on Earth.