Revenues of Activision Blizzard, Inc. (NASDAQ: ATVI) declined in the third quarter as the Video game publisher continues to witness weakness in bookings. Consequently, adjusted earnings dropped but topped Wall Street’s prediction. The stock slipped about 2% on Thursday evening, following the announcement.
In the September-quarter, revenues dropped 15% annually to $1.28 billion but came in above the market’s prediction. Dragging the top-line, bookings, a key performance indicator, declined 27% to $1.21 billion. Net bookings from digital channels plunged 32% to $0.98 billion. Overall, the company had 316 million monthly active users at the end of the quarter, up 8%.
At $0.38 per share, adjusted net earnings were down 10% from last year but above the estimates. Unadjusted net income declined to $204 million or $0.26 per share from $260 million or $0.34 per share last year.
The initial response to the recently released expansion of World of Warcraft and sequels to the Diablo and Overwatch franchises have been mixed. Meanwhile, Call of Duty: Modern Warfare from Activision and its mobile version fared quite well, which is expected to benefit the fourth-quarter results.
“Recent launches have enabled significant growth in the size of our audiences for our Call of Duty® and World of Warcraft® franchises. As we introduce mobile and free-to-play games based on our franchises we believe we can increase audience size, engagement and monetization across our wholly owned franchises,” said CEO Bobby Kotick.
Of late, esports has been a key revenue driver for Activision, which is expected to continue in the coming quarters. Recently, the company had come under fire after it banned an esports player for links to the ongoing protests in Hong Kong.
Shares of Activision gained 19% so far this year. The stock closed Thursday’s regular session sharply lower and continued to lose during the after-hours, following the announcement.