Guitar Hero brings higher revenue for Activision

Reuters
Friday 06 November 2009 05:05 EST
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Video game publisher Activision Blizzard reported a quarterly profit that matched analysts' estimates and revenue that was higher than expected, led by sales of the company's latest "Guitar Hero" offering.

Activision, the world's largest video game publisher by market capitalization, has the most anticipated release of the year on tap, "Call of Duty: Modern Warfare 2," set for release next week. Some expect it to be the biggest-selling game of all time.

But Chief Executive Bobby Kotick told Reuters in an interview that although he was confident in the company's product lineup for the crucial holiday season, he was "very concerned" about the consumer mood.

"The question is whether the consumer will materialize, and I think there's huge risk that the consumer won't materialize."

According to data released Thursday by NPD, GfK Chart-Track and Enterbrain, third-quarter industry-wide video game software unit sales fell a combined 6 percent in the world's three largest markets: the United States, Japan and the United Kingdom.

Activision reported a third-quarter net profit of $15 million (£9 million), or 1 cent a share, compared with a year-ago net loss of $108 million (£65 million), or 8 cents a share.

Excluding items, Activision earned 4 cents a share, matching with the average analyst estimate. Revenue fell 1 percent to $703 million (£423 nillion), while non-GAAP revenue came in at $755 million (£454 million). Wall Street was expecting revenue of $724 million (£436 million).

For the current quarter, the company forecast earnings excluding items of 43 cents a share on non-GAAP revenue of $2.22 billion (£1.3 billion). It said its full-year 2009 forecast remains unchanged.

Shares of Santa Monica, California-based Activision closed at $10.88 and rose to $11.05 in extended trading.

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