Activision Reports Strong Q2 Results

This afternoon, Activision released its financial results covering the second quarter ended September 30th, 2004. Building on strong software sales, particularly involvin...
This afternoon, Activision released its financial results covering the second quarter ended September 30th, 2004. Building on strong software sales, particularly involving DOOM 3, X-Men Legends, Call Of Duty: United Offensive, Rome: Total War and its top-selling title, Spider-Man 2, Activision reported a 164% increase, or a $193.1 million increase in net revenue, raising the figure from $117.5 million during the second quarter last year to $310.6 million this year. Net income for the second quarter also showed growth, with net income flipping from a net loss of $10.1 million last year to a net gain of $25.5 million this year. Robert A. Kotick, Chairman and CEO of Activision commented with regard to the results: "In addition to delivering record net revenues and earnings for the quarter, we also significantly increased our market position in North America and Europe. As of this date, five of our games have shipped more than one million units each and three of those titles have achieved multi-million-unit status." The company also highlighted its sometimes market-leading position, pointing out that Activision was the #1 PC publisher in North America for the month of August, according to NPD Techworld; the #1 publisher overall in the U.K. for the months of July and August, according to Chart Track; and the #1 publisher overall in Germany and the #2 publisher overall in France for the month of August, according to Media Control and GfK respectively. With regard to this, the company's earning call specifically revealed that CG movie adaptation Shark Tale has already shipped a million units. This came on top of word that DOOM 3 has not only managed to surpass the million and a half sales mark on the relatively deflated PC market, but has also dominated worldwide PC charts. Although not specifically named, it's likely that Spider-Man 2 and X-Men Legends are among the other million-plus sellers. Activision also used the call to provide its analsysis on current and expected game hardware installed base. Covering figures up through the end of September 2004, Activision calculated the total U.S. installed console base at 65.8 million units, with that figure expected to grow to 73 million units by calendar year end. Breaking that down by platform, the company argued the following: PlayStation 2 Installed Base: 24.9 million units Calendar Year Expectations: 28 million units Xbox Installed Base: 9.8 million units Calendar Year Expectations: 11 million units GameCube Installed Base: 7.9 million units Calendar Year Expectations: 9 million units Game Boy Advance Installed Base: 22.3 million units Calendar Year Expectations (incl. Nintendo DS): 25 million In addition, the company's earnings call touched both on DOOM issues and next-gen chatter. Addressing questions concerning both the Xbox release of the game and the upcoming PC expansion, Activision stated that it expects to have the titles released during the fourth fiscal quarter (ending March 2005), but that id Software has the final say on shipping date. The company also echoed analysis from publishers including Electronic Arts, stating that it expects a (non-specific) next-generation console hardware platform to be launched in time for Christmas 2005. Finally, the company forecast its revenue for the entire fiscal year to be $1.15 billion, up from previous estimates of $1.10 billion, building off current successes and forthcoming titles such as Tony Hawk's Underground 2, Lemony Snicket's A Series of Unfortunate Events, Call of Duty: Finest Hour and the aforementioned DOOM 3 for Xbox.

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