Activision Blizzard's Sales Tracking Ahead of Guidance

Leading publisher Activision Blizzard happily announced today that its sales and earnings for the March quarter are tracking ahead of the company's previously announced outlook of $860 million in net revenues and earnings per share of $0.08. The company cited better-than-expected sales of its games at retail, particularly Call of Duty, Guitar Hero and World of Warcraft. 

"Global consumer response to the Call of Duty and Guitar Hero franchises and Blizzard Entertainment's World of Warcraft remains strong despite the challenging economic environment," said Robert Kotick, CEO of Activision Blizzard. "We exceeded our quarterly financial goals as the video game market continues to grow and our franchises continue to perform. This bodes well for our upcoming spring titles Transformers: Revenge of the Fallen, X-Men Origins: Wolverine and Ice Age: Dawn of the Dinosaurs, which are inspired by theatrical feature films releases, Prototype, a new intellectual property, and the release of Guitar Hero Smash Hits as well as continued sales of our recently released Guitar Hero Metallica game."

Although the publisher is seeing better performance in the March quarter, it did not update its full-year outlook. Activision Blizzard reaffirmed its previously announced calendar year outlook of $4.2 billion in net revenues and earnings per share of $0.22.

Wedbush Morgan analyst Michael Pachter remains quite bullish on Activision Blizzard. In his latest investor note, he commented: "We continue to believe that Activision can gain share in 2009, and we think that industry growth will be roughly double the 'mid-single digit' guidance that the company expects. Activision is well positioned to deliver more than 50% in contribution margin from its revenue growth, so if it is able to maintain or gain share in 2009, we believe that the company can substantially exceed our 2009 estimates."