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Activision (ATVI) to Report Q2 Earnings: What's in Store?
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Activision Blizzard is set to report second-quarter 2022 results on Aug 1.
The Zacks Consensus Estimate for revenues is pegged at $1.53 billion, indicating a decline of 20.51% from the year-ago quarter’s reported figure.
The consensus mark for second-quarter earnings has moved up 2.2% to 46 cents per share in the past 30 days.
The company’s earnings beat the Zacks Consensus Estimate in two of the last four quarters and missed the same in two. Activision has a negative trailing four-quarter earnings surprise of 7.66%, on average.
Let’s see how things have shaped up prior to this announcement.
Activision is expected to have benefited from the popularity of its franchises, including Call of Duty (COD), Overwatch, Hearthstone, World of Warcraft, Candy Crush Saga and Candy Crush Friends Saga, in the to-be-reported quarter.
The expanding user bases of COD, Hearthstone, World of Warcraft and King’s franchises are expected to have boosted in-game spending, driving net bookings and the top line in the to-be-reported quarter.
In the second quarter, the company released Diablo Immortal, an expansion of its most iconic game franchise Diablo. As a massively multiplayer online roleplaying game, Diablo Immortal allows players to experience the game alone or with others. This is expected to have increased active user growth in the to-be-reported quarter.
Major game releases like Fractured in Alterac Valley, Hearthstone Mercenaries and Call of Duty: Vanguard in the first quarter are expected to have had a positive impact on the user engagement in the to-be-reported quarter.
However, decline in video game spending in the quarter is expected to have reflected on Activision’s top-line growth. Per VentureBeat, which cited NPD data, consumer spending on video games was down 8%, 19% and 11% year over year in April, May and June, respectively.
Intensifying competition from game publishers like Take Two Interactive (TTWO - Free Report) and Nintendo (NTDOY - Free Report) is expected to have hurt Activision’s top line in the second quarter.
In the second quarter, Take-Two’s subsidiaries Private Division and Roll7 announced the launch of OlliOlli World: VOID Riders, the first of the two expansions to the skateboarding action-platformer game, OlliOlli World.
Nintendo’s recent releases of Mario Strikers: Battle League, available on Nintendo Switch and Fire Emblem Warriors: Three Hopes are expected to have pulled gamers to its platform in the to-be-reported quarter.
Major Development in 2022
On Jan 18, Microsoft (MSFT - Free Report) announced plans to acquire Activision Blizzard.
Microsoft will pay $95.00 per Activision share, with the total transaction value being $68.7 billion. The deal is expected to close in the fiscal year 2023.
Microsoft, through its decision to acquire this Zacks Rank #3 (Hold) company, showcases its intent to expand its gaming business. Activision’s popular gaming franchises, including the recent launch, will add more titles to Microsoft’s Xbox Console. You can see the complete list of Zacks #1 (Strong Buy) Rank stocks here.
Image: Bigstock
Activision (ATVI) to Report Q2 Earnings: What's in Store?
Activision Blizzard is set to report second-quarter 2022 results on Aug 1.
The Zacks Consensus Estimate for revenues is pegged at $1.53 billion, indicating a decline of 20.51% from the year-ago quarter’s reported figure.
The consensus mark for second-quarter earnings has moved up 2.2% to 46 cents per share in the past 30 days.
The company’s earnings beat the Zacks Consensus Estimate in two of the last four quarters and missed the same in two. Activision has a negative trailing four-quarter earnings surprise of 7.66%, on average.
Let’s see how things have shaped up prior to this announcement.
Activision Blizzard, Inc Price and EPS Surprise
Activision Blizzard, Inc price-eps-surprise | Activision Blizzard, Inc Quote
Factors to Consider
Activision is expected to have benefited from the popularity of its franchises, including Call of Duty (COD), Overwatch, Hearthstone, World of Warcraft, Candy Crush Saga and Candy Crush Friends Saga, in the to-be-reported quarter.
The expanding user bases of COD, Hearthstone, World of Warcraft and King’s franchises are expected to have boosted in-game spending, driving net bookings and the top line in the to-be-reported quarter.
In the second quarter, the company released Diablo Immortal, an expansion of its most iconic game franchise Diablo. As a massively multiplayer online roleplaying game, Diablo Immortal allows players to experience the game alone or with others. This is expected to have increased active user growth in the to-be-reported quarter.
Major game releases like Fractured in Alterac Valley, Hearthstone Mercenaries and Call of Duty: Vanguard in the first quarter are expected to have had a positive impact on the user engagement in the to-be-reported quarter.
However, decline in video game spending in the quarter is expected to have reflected on Activision’s top-line growth. Per VentureBeat, which cited NPD data, consumer spending on video games was down 8%, 19% and 11% year over year in April, May and June, respectively.
Intensifying competition from game publishers like Take Two Interactive (TTWO - Free Report) and Nintendo (NTDOY - Free Report) is expected to have hurt Activision’s top line in the second quarter.
In the second quarter, Take-Two’s subsidiaries Private Division and Roll7 announced the launch of OlliOlli World: VOID Riders, the first of the two expansions to the skateboarding action-platformer game, OlliOlli World.
Nintendo’s recent releases of Mario Strikers: Battle League, available on Nintendo Switch and Fire Emblem Warriors: Three Hopes are expected to have pulled gamers to its platform in the to-be-reported quarter.
Major Development in 2022
On Jan 18, Microsoft (MSFT - Free Report) announced plans to acquire Activision Blizzard.
Microsoft will pay $95.00 per Activision share, with the total transaction value being $68.7 billion. The deal is expected to close in the fiscal year 2023.
Microsoft, through its decision to acquire this Zacks Rank #3 (Hold) company, showcases its intent to expand its gaming business. Activision’s popular gaming franchises, including the recent launch, will add more titles to Microsoft’s Xbox Console. You can see the complete list of Zacks #1 (Strong Buy) Rank stocks here.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.