Activision beats expectations despite falling revenues

Activision beats expectations despite falling revenues
Seth Tipps

By Seth Tipps

November 7th 2013 at 9:35AM

Publisher revises its end-of-year outlook up by $10 million

Activision's Q3 financial report has arrived bearing news of a company doing better than expected, but not necessarily smiling about it.

Revenues fell 18 percent from last year to $691 million and profits fell 75 percent to %56 million, but it should be pointed out (and Activision did) that the same period last year was the quarter after the launch of Diablo III and Blizzard was still enjoying a peak in WoW subscribers after the launch of Mists of Pandaria.

It should also be pointed out that the sales figures don't include the publisher's annual cash cow Call of Duty or Skylanders SWAP Force, so beating expectations during a slow three months is fairly good news going into the holiday season.

The fourth quarter report will also show the first results for the publisher during the new console generation, and with the better-than-expected sales during this period Activision has chosen to revise its anticipated annual sales upward to $4.32 billion from $4.31 billion.

One piece of good news is that Activision reported digital sales are up to 59 percent of its total revenue – a record for its third quarter.

The company also raised its estimated earnings per share up to $0.83 from between $0.80 to $0.82, thought that didn't stop share prices falling to $16.53 from an open of $16.90.

“Our third - quarter results exceeded our expectations, and we are able to raise our outlook for 2013 net revenues and earnings per share,” said Activision CEO Bobby Kotick.

“Robust continued engagement with our core franchises drove digital revenue, which constituted a majority of all revenue. This quarter demonstrates that games like Call of Duty and World of Warcraft engage and entertain our fans year round.”

The company succeeded in splitting from French conglomerate Vivendi in October in an $8.2 billion deal despite some legal hurdles.