Activision Blizzard Earnings: Here’s Why Shares are Down Now

Activision Blizzard, Inc. (NASDAQ:ATVI) delivered a profit and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are down 5.64%.

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Activision Blizzard, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 183.33% to $0.17 in the quarter versus EPS of $0.06 in the year-earlier quarter.

Revenue: Decreased 31.4% to $804 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Activision Blizzard, Inc. reported adjusted EPS income of $0.17 per share. By that measure, the company beat the mean analyst estimate of $0.11. It beat the average revenue estimate of $704.2 million.

Quoting Management: Bobby Kotick, Chief Executive Officer, Activision Blizzard, said, “Our first-quarter performance was driven by continued consumer interest in all of our key franchises. Blizzard Entertainment’s StarCraft® II: Heart of the Swarm™ was the #1 PC game for the quarter.¹ Additionally, during the quarter, Blizzard’s World of Warcraft® remained the #1 subscription-based MMORPG in the world with more than eight million subscribers, although the game saw declines of approximately 1.3 million subscribers, mainly from the East, but in the West as well.²”

Key Stats (on next page)…

Revenue decreased 54.52% from $1.77 billion in the previous quarter. EPS decreased 78.21% from $0.78 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.09 to a profit $0.05. For the current year, the average estimate has moved down from a profit of $0.96 to a profit of $0.85 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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