On May 9, 2011, Activision Blizzard held their First Quarter 2011 Earnings Conference Call. Executives present during the call included Bobby Kotick, CEO of Activision Blizzard; Thomas Tippl, COO and CFO of Activision Blizzard; Eric Hirshberg, CEO of Activision Publishing; and Mike Morhaime, CEO of Blizzard Entertainment. They were discussing the company’s recent retail success as well as future plans for product release and the general direction of Activision Blizzard.
First up to speak was Bobby Kotick, going over some basic numbers and discussing the move toward digital content. The CEO noted that Activision Blizzard delivered record setting first quarter net revenues, operating margins and EPS. Net revenues increased more than 30% year-over-year. Additionally, net revenues from digital channels grew 30% year over the year.
“We continue to shift our business towards digital delivery of content and establishing direct ongoing relationships with our audiences. While this quarter, more than 50% of our revenues were from digital channels, we are still scratching the surface when it comes to the role that digital delivery will play in our products and franchises,” said Robert Kotick.
Robert Kotick noted that Activision Blizzard’s resources have allowed them to take advantage of the opportunities in digital. Activision’s first quarter results were largely driven by digital content packs for Callof Duty Black Ops: First Strike and Call of Duty Black Ops: Escalation which Activision is able to immediately distribute over the Internet via platforms like Xbox LIVE and PSN.
“Today, we make games for and support two of the largest online communities in consumer entertainment, World of Warcraft and Call of Duty, which collectively serve more than 30 million people,” said Kotick.
Following Kotick, Eric Hirshberg, CEO of Activision Publishing spoke about Activision’s new family entertainment title Skylanders: Spyro’s Adventure. The game includes action figures that allow the user to transport the real-life toys into the game simply by placing them on an external portal.
“Today, the Skylanders property has tested incredibly well, has generated a huge buzz and support from our retail partners as it is expected to launch in the holiday quarter,” said Eric Hirshberg.
As the leading interactive entertainment company, Activision should continue benefitting from the convergence between entertainment, the Internet and TV. The company’s focus on digital content as well as its anticipated console releases like Spyro’s Adventure, point to a bright future. This is not surprising for the publishing company responsible for the record-breaking titles such as World of Warcraft, StarCraft, Call of Duty andGuitar Hero.
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