Activision says quarterly results to top its view

NEW YORK (Reuters) - Activision Inc (ATVI.O) said on Tuesday it expects fiscal first-quarter results to exceed expectations, thanks to strong sales of its video games such as "Spider-man 3" and "Guitar Hero," sending shares up 2 percent.

The U.S. video game publisher, which trails only market leader Electronic Arts Inc. (ERTS.O), said it shipped more than 8 million games in the quarter ended in June, which was ahead of some analysts' expectations.

Activision said it shipped over 4 million "Spider-Man 3" games, 2 million "Shrek the Third" games, about 1 million of its "Transformers: The Game," and more than 1 million "Guitar Hero II" games in the quarter.

"As a result, the company now expects that its financial results for the first quarter fiscal year 2008 will exceed its previously reported outlook on May 31, 2007," Activision said.

The company did not give specific new financial forecasts for the quarter, nor did it say how shipments compared with previous periods.

But total video game shipments were about half a million units ahead of estimates from Wedbush Morgan analyst Michael Pachter, who described the numbers as a "monster sell-in" in a note to clients.

Pachter raised his revenue estimate for the quarter to $450 million from $430 million.

On May 31, Activision had forecast first-quarter net revenue of $425 million and earnings per share of 3 cents.

Analysts surveyed by Reuters Estimates had expected a profit of 6 cents a share on revenue of $428.8 million for the period.

Pachter said the strong first quarter could also signal better-than-expected sales for the rest of the year.

"We have not adjusted our estimates for the remaining three quarters of the year, but believe that the (first quarter) upside could lead to higher reorder volumes of each of the games listed in the back half of the fiscal year," he said.

He has a $24.50 price target on Activision shares.

The stock climbed 37 cents or 2 percent to $18.77 in morning trade on Nasdaq.

Activision, which publishes titles for video gaming consoles from Microsoft Corp. (MSFT.O), Nintendo Co. Ltd.(7974.OS) and Sony Corp. (6758.T), expects to announce its first-quarter fiscal 2008 results in early August.

(Reporting by Sinead Carew and Franklin Paul)