DJ Activision Blizzard Stock Jumps After Earnings. Here's Why. -- Barrons.com
Activision Blizzard shares surged in the extended session Thursday, after the company's biggest videogame franchises helped power revenue above fourth-quarter sales expectations.
Activision (ticker: ATVI) stock advanced 11% in extended trading, after closing off 0.1% to $92.68.
The videogame publisher posted fourth-quarter net bookings topped expectations, rising 13% to $3.05 billion. Analysts had expected of bookings of $2.79 billion. Videogame companies often use non-GAAP net bookings in lieu of revenue because the measure captures physical in-store sales and products sold digitally during the period.
Revenue rose to $2.41 billion from $1.99 billion a year ago.
Activision said that its strong fourth-quarter performance was because of sales in franchises such as the mobile hit Candy Crush, Call of Duty, and World of Warcraft.
Activision launched Call of Duty: Black Ops Cold War during the fourth quarter, which typically adds roughly $500 million in sales in the first two weeks after launch, though this year the company didn't disclose the figure. During the quarter, the videogame maker released an expansion to World of Warcraft that it claimed was the "fastest-selling PC game of all time."
The company said its mobile unit King delivered its best full-year financial performance since Activision acquired it. King boasted 240 million monthly active users in the fourth quarter.
Activision reported fourth-quarter GAAP net income of $508 million, which amounts to 65 cents a share, compared with a net profit of $525 million, or 68 cents a share a year ago. Analyst had projected GAAP earnings of 66 cents per share.
For 2021, the company said it expects full-year GAAP earnings of $2.83 a share, and bookings of $8.45 billion.
The company said it would share more about its coming plans for Blizzard franchises at BlizzConline, which will take place Feb. 19 and Feb. 20. Activision said that it had no plans to release Diablo 4 or Overwatch 2 in 2021 and executives didn't give a release window.
"In a year filled with adversity our extraordinary employees were determined to provide connection and joy to our 400 million players around the world," Activision CEO Bobby Kotick said. "They accomplished this as well as generating record financial results for our shareholders."
Activision stock has gained 58% in the past year, as the S&P 500 index rose 18%.
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(END) Dow Jones Newswires
February 04, 2021 19:41 ET (00:41 GMT)
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