Activision Blizzard, Inc. (ATVI) Information Technology – Software| Reports August 4, After Market Closes

Key Takeaways

  • The Estimize consensus is looking for earnings per share of 47 cents on $1.51 billion in revenue, slightly higher than the Wall Street consensus
  • Overwatch has been one of the most popular games in the past 3 months, boasting over 10 million players as of June
  • Other initiatives include expanding digital offerings, mobile games, esports, and broadening its legacy games.
  • What are you expecting for ATVI? Get your estimate in here!

Activision is perhaps the most attractive company not named Amazon or Facebook this earnings season. The company is firing on all cylinders and should have no problem topping expectations with its second quarter results tomorrow. Earnings will likely be driven by the success of its new flagship game, Overwatch. Beyond that, Activision has made headway at increasing digital revenue, leveraging its acquisition of King Digital, and broadening its already popular franchises.

The Estimize community has set the bar high for tomorrow’s report. Analysts are calling for earnings per share of 47 cents, up 260% compared to the same period last year. That estimate has increased 13% since Activision’s last report in May. Revenue is anticipated to increased almost 100% to $1.51 billion, marking a second consecutive quarter of double digit sales growth. Shares of Activision are up 55% in the past 12 months.

Activision Blizzard, Inc. (ATVI)

Activision’s prowess for innovation has put it in a position to be more successful than its peers. Overwatch is one of the most popular games over the past 3 months, boasting 10 million users as of June. Besides Overwatch, Activision’s franchise consists of Destiny, another hit sensation from this year, and legacy games like StarCraft and World of Warcraft. The company recently announced they would be releasing new version of Destiny next year, a surefire boost to earnings.

Initiatives to expand digital revenue is also finding traction. Digital offerings are becoming a new theme in the gaming industry. It provides consumers with a convenient alternative to visiting their local GameStop. EA reported strength in this sector this week and it won’t be surprising if Activision does as well. The company is also emerging a leader in the mobile market after the acquisition of King Digital. It’s rumored that Activision is working on an augmented reality type game, piggybacking on the success of Pokemon Go.

The biggest difference between Activision and its peers is its attempt to become a broad based media company. The company released its first movie 6 months based on the World of Warcraft games. They are also having their hand at esports. Activision is one of the leaders in this space which adds a new layer of potential revenue.

Activision Blizzard, Inc. (ATVI)

Do you think ATVI can beat estimates? There is still time to get your estimate in here!