Activision Blizzard Inc. (NASDAQ: ATVI) reported a 23% dip in earnings for the fourth quarter of 2019 due to lower revenue. However, the results exceeded analysts’ expectations. The company remained uncertain about the near-term and long-term as Q1 outlook beat consensus view while full-year forecast missed it.
Net income plunged by 23% to $525 million or $0.68 per share. Adjusted earnings dropped by 31% to $0.62 per share. Revenue fell by 17% to $1.99 billion. Analysts had expected EPS of $1.19 on revenue of $2.67 billion for the fourth quarter.
For the latest quarter, the results excluded GAAP deferrals of $722 million in revenue, $0.61 in unadjusted EPS, and $0.39 in adjusted EPS.
Looking ahead into the first quarter, the company expects net revenue of about $1.64 billion, unadjusted earnings of about $0.55 per share and adjusted earnings of $0.66 per share. The consensus estimates EPS of $0.39 on revenue of $1.35 billion.
For the full year 2020, Activision predicts net revenues of about $6.45 billion, unadjusted EPS of about $1.85 and adjusted EPS of about $2.22. The Street views EPS of $2.49 on revenue of $6.92 billion for the full year.
For the fourth quarter, net bookings decreased by 5% year-over-year to $2.71 billion. Net bookings from digital channels remained unchanged from the previous year quarter at $1.88 billion. In-game net bookings were $1.09 billion. For the December quarter, overall Activision Blizzard Monthly Active Users were 409 million.
In Activision, Call of Duty: Modern Warfare unit sales increased by a double-digit percentage versus Call of Duty: Black Ops 4, with growth across both PC and console. PC sales on Battle.net grew 50% year-over-year, while Modern Warfare saw strong growth in full-game downloads with console digital mix at nearly 50%. In-game net bookings rose by a double-digit percentage versus Black Ops 4.
In Blizzard, the growth was driven by Descent of Dragons, new Battlegrounds game mode, and World of Warcraft. Overwatch launched on the Nintendo Switch, further expanding a community that has surpassed 50 million players globally since launch.
In King, Candy Crush turned out to be once again the top-grossing franchise in the US mobile app stores in the fourth quarter. Candy Crush Saga mobile reach grew year-over-year and it was the top-grossing title in the US app stores.
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