SANTA MONICA (dpa-AFX) - Activision Blizzard Inc. (ATVI), the world's largest video game publisher, said Wednesday after the markets closed that its third quarter profit rose 53% from last year, driven by the successful launch of Warcraft: Mists of Pandaria and continued sales of top-selling PC game Diablo III.
The company's quarterly earnings per share, excluding items, also breezed past Wall Street expectations as did its adjusted revenue.
At the same time, the company forecast forecast fourth quarter revenue and earnings above analysts' current consensus estimate, and once again raised its outlook for the calendar year 2012.
Robert Kotick, Chief Executive Officer, Activision Blizzard, said, 'Based on our strong third-quarter performance and increased visibility into the remainder of the year, we are raising our full-year financial outlook and expect to deliver record non-GAAP operating margins and the highest non-GAAP earnings per share in our company's history. We now expect non-GAAP earnings per share will increase more than 18% year over year.'
'As we look to 2013, we are cautious about business prospects given a continuingly challenged global economy, the ongoing console transition and very difficult year-over-year comparables due to Blizzard's record-shattering Diablo III sales in 2012,' Kotick added.
Activision Blizzard shares are currently gaining 1.53% in after hours trading after closing the day's regular trading session at $11.13, down 21 cents or 1.85. The shares trade in a 52-week range of $10.730 to $13.51.
Santa Monica, California-based Activision Blizzard, which is a subsidiary of French media and telecoms giant Vivendi SA, reported reported net income for the third quarter of $226 million or $0.20 per share, compared to $148 million or $0.13 per share for the year-ago quarter.
Excluding items, adjusted net income for the third quarter was $168 million or $0.15 per share, compared to $87 million or $0.07 per share in the prior year quarter.
On average, 25 analysts polled by Thomson Reuters expected the company to earn $0.08 per share for the third quarter. Analysts' estimates typically exclude special items.
The maker of the 'World of Warcraft' and 'Call of Duty' titles said net revenues for the third quarter rose 12% to $841 million from $754 million a year ago. On an adjusted basis, the company's net revenues increased 20% to $751 million from $627 million last year. Twenty-four analysts had a consensus revenue estimate of $709.80 million for the third quarter.
Third quarter revenues from digital channels grew 1% from last year to $430 million and represented 51% of the company's total revenues, while revenues from retail channels rose 43% from a year earlier to $357 million and represented 43% of the company's total revenues.
For the first nine months of 2012, Activision Blizzard was the #1 PC publisher in the U.S. and Europe. Additionally, for the third quarter, Blizzard Entertainment had two of the top five PC games with Diablo III and World of Warcraft: Mists of Pandaria.
As of September 30, Blizzard Entertainment's World of Warcraft remains the number one subscription-based MMORPG, with more than 10 million subscribers. Blizzard Entertainment released World of Warcraft: Mists of Pandaria on September 25, and sold through about 2.7 million copies of the game as of its first week of release.
Last month, Activision Publishing Skylanders Giants, which is off to a great start.
Activision Publishing expects to release Call of Duty: Black Ops II on November 13, Wipeout 3 on November 18 and Family Guy: Back to the Multiverse on November 20.
In late June, there were reports that Vivendi has decided to seek a buyer for its $8.1 billion stake in Activision Blizzard. If no buyer emerges for the 61% holding in Activision Blizzard, Vivendi plans to sell a partial holding on the open market, the reports said.
Looking forward to the fourth quarter, the company forecasts net revenue of $1.485 billion, adjusted net revenue of $2.412 billion, earnings of $0.19 per share and adjusted earnings of $0.70 per share. Analysts currently expect the company to earn $0.67 per share on revenue of $2.34 billion for the fourth quarter.
For the calender year 2012, the company now expects net revenue of $4.574 billion, adjusted net revenue of $4.805 billion, earnings of $0.88 per share and adjusted earnings of $1.10 per share. Previously, the company expected net revenue of $4.330 billion, adjusted net revenue of $4.630 billion, earnings of $0.69 per share and adjusted earnings of $0.99 per share.
Analysts currently expect the company to earn $1.01 per share on revenue of $4.68 billion for the full year 2012.
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