By Malathi Nayak
SAN FRANCISCO Feb 6 Activision Blizzard Inc
reported better-than-expected fourth-quarter income on
strong sales of its "Call of Duty" titles during the holidays,
helping drive its stock to a five-year high despite a middling
The largest U.S. videogame publisher believes its coming
action game "Destiny" will become the company's next
billion-dollar franchise, Chief Executive Officer Bobby Kotick
said in a statement. The game is expected to launch in
After the arrival of the Xbox One and PlayStation 4 consoles
in November last year, game software sales slid in December
because gamers held back on spending on titles for older
Analysts expect spending to recover in coming months as more
new consoles find their way into gamers' hands and publishers
introduce fresh titles.
Activision's strategy "of doing a few things extremely well
while keeping a close eye on costs has served us well and we
expect it to continue to serve us well in the future," Chief
Financial Officer Dennis Durkin said on an earnings call with
For the first quarter ending March 31, the videogame maker
forecast a profit below industry analysts' targets, calling for
earnings, excluding items, of 9 cents a share, versus an average
forecast of 11 cents a share.
Despite the miss, its stock climbed briefly to a five-year
high of $18.60 in after-hours trading, after closing at $17.17
on the Nasdaq on Thursday.
The company, also known for its "Skylanders" games, said its
fourth-quarter revenue dropped to $1.52 billion from $1.77
billion a year ago, and net income fell to 22 cents per share
from 31 cents per share, in the year-ago period.
The company's fourth-quarter non-GAAP income, adjusted for
the deferral of digital revenue and other items, of 79 cents a
share was a cent higher than a year ago. Wall Street's average
forecast was 73 cents per share, according to Thomson Reuters
Adjusted for the deferral of digital revenue and other
items, fourth-quarter revenue dropped 13 percent to $2.27
billion from $2.6 billion a year ago. This was in line with Wall
Street analysts' expectations of $2.22 billion, the company
In the fourth quarter of 2013, the company's "Call of Duty:
Ghosts" - the latest iteration from its popular military-style
shooter game series - was the best-selling title in units and
sales in the United States and Europe, the company said in its
The Santa Monica-based company's popular "Skylanders"
franchise, a children's fantasy-adventure game series sold with
toys whose avatars come to life onscreen, touched $2 billion in
sales as of Dec. 31. The "Skylanders" line was launched in 2011.
Activison's 2014 pipeline includes new titles from its "Call
of Duty" and "Skylanders" series, but the company has yet to
announce launch dates.