Activision Blizzard ended the year with record revenue

That didn’t stop her from cutting 800 people.

Along with the news of layoffs from Activision Blizzard came the company’s financial results for the fourth quarter and for the whole of 2018. Both quarterly and annual figures turned out to be the best in the company’s history.

Nevertheless, Activision Blizzard expected more.

Results for the quarter

The publisher’s net revenue for the fourth quarter was $2.38 billion. Revenue for the same quarter of 2017 was $2.043 billion.
Operating profit for October-December 2018 reached $694 million. This is three times more profit for the same months of 2017.
Activision Blizzard predicted lower revenue in the fourth quarter of 2018 — $2.24 billion.
However, she earned $2.835 billion, and expected $3.05 billion. (Here, earnings are net bookings: net sales plus deferred transfers from games coming after the reporting period.)

Net annual income was $7.5 billion. This is almost half a billion dollars more than in 2017.
Operating profit reached $1.9 billion, which is $700 million more than the profit in 2017.
The company expected lower annual revenue. The forecast indicated $7.34 billion.
However, as in the case of the quarterly forecast, net bookings’ annual figure was lower than expected: $7.26 billion versus $7.47.

For the fourth quarter of 2018, Activision’s revenue amounted to $1.4 billion, Blizzard — $686 million, and King — $543 million.
For the year, revenue was distributed as follows: Activision — $2.45 billion, Blizzard — $2.3 billion, King — $2.08 billion.
The MAU of King projects amounted to 268 million. MAU Activision — 53 million. Blizzard has 35 million (due to the stable performance of Overwatch and Hearthstone, as noted in the report).

In 2019, Activision Blizzard’s dividends may increase by 9% to $0.37 per share. At the same time, the company plans to buy back its shares for $ 1.5 billion.
According to analyst Niko Partners, it was the expected increase in dividends that led to the fact that the value of the publisher’s shares jumped by 4% today.
Two days ago, Activision Blizzard shares sank to a two-year low. The fall was triggered by rumors of imminent mass layoffs in the company. Today the rumors were confirmed: 800 employees will be fired.
One of the reasons for the layoffs lies in net bookings for the fourth quarter and for the year, which were lower than predicted. According to CEO Bobby Kotick, the publisher failed to realize its full potential. In general, the company expects a difficult 2019. That’s why she needed a reorganization.
Activision Blizzard plans to invest more in its largest franchises: Call of Duty, Warcraft, Overwatch, Diablo and Candy Crush. The staff of developers will be increased by 20%.

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