Activision Blizzard surprises Wall Street with better-than-expected profits, earnings
Game developer Activision Blizzard pulled off a surprise when it announced earnings that topped expectations from Wall Street analysts.
Yahoo Finance reports that the Santa Monica-based Activision Blizzard posted GAAP revenues of $1.04 billion for the quarter ended June 30, 2015, up from $970 million last year. Non-GAAP revenues for Activision Blizzard were at $759 million, up from 658 million dollars for the same quarter in 2014.
In terms of net income, the company posted a high net income of $212 million (29 cents a share), up $8 million from the previous year's $204 million mark. The company's stock has climbed more than 25 percent since the start of the year.
Digital downloads have proved to be very lucrative for the company, as it notched record GAAP net revenues from digital channels of $569 million. Non-GAAP net revenues for Activision Blizzard were at $611 million.
The second quarter revenues from digital channels represent 55% of the company's total revenues, and reflect the large-scale shift of the video game industry towards direct downloads of games instead of physical sales of game discs as more consumers take to mobile gaming.
The better-than-expected earnings results have caused Activision Blizzard to adjust both per-share earnings and total revenue for the fiscal third quarter, ending October this year.
SFGate said that the company has moved its per-share earnings to 14 cents a share, while revenue is being pegged at $930 million. Furthermore, the company expects full-year earnings at $1.30 a share, with $4.6 billion revenue.
Analysts had expected slightly lower earnings results for Activision Blizzard for the second quarter of 2015, citing a slowdown in the industry. According to SFGate, analysts have estimated Activision Blizzard's earnings to be 9 cents a share for Q2 2015. For the full-year results, analysts had the company earning a profit of $1.23 a share on revenues of $4.47 billion.
However, the company's earnings received a boost from huge sales from the latest addition to the Call of Duty franchise, as well as other releases like Destiny, Heroes of the Storm, and expansion packs for World of Warcraft.