Activision's Kotick Has Retail in His Grip

Activision/Blizzard One Billion Dollar Revenues Driven by Digital

Posted by Staff
Activision's Kotick Has Retail in His Grip
Activision/Blizzard has had a stonking second financial quarter 2011 with a declaration of "record GAAP net revenues of $1.1 billion, as compared with $967 million for the second quarter of 2010". And CEO Robert - Bobby - Kotick - is stating that digital revenues are to be thanked.

In the official statement supporting the release of the financials, Mr Kotick state, "Our better-than-expected second-quarter performance was driven by record digital sales of our online-enabled franchises. For the six month period, net revenues from digital channels grew more than 20%, driving record operating margin and EPS (earnings per share) growth of more than 50%."

Notice, however, that he doesn't mention how much revenue digital brought in. Here's the numbers:

Traditional Retail: $660m or 58% of net revenues for the quarter.
Digital Retail: $423 or 37% of net revenues for the quarter.

So, digital is still behind traditional outlets. But let's compare that to the same period last year.

Traditional Retail: $584 or 61% of net revenues for the quarter.
Digital Retail: $332 or 34% of net revenues for the quarter.

So, in terms of the percentage of total revenues, Mr Kotick has a point, with digital taking percentage points from traditional.

In short, Activision/Blizzard is in very, very good shape - with a new boxed Call of Duty this year - to bargain with bricks'n'mortar retailers.

Kotick is obviously aware of the CoD power, making sure to explain to investors that, "To date, pre-orders for Modern Warfare 3 have significantly exceeded the pre-orders for Black Ops at this time last year.

"In addition, we believe that Call of Duty Elite, which was built for Modern Warfare 3 and is expected to launch with the game on November 8, should redefine social connectivity for multiplayer gaming."

More detail over here.

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