Continuing the rapid growth seen in recent years, gaming is probably on the fast-track to outperforming the mighty film industry in terms of scale. In a testimony to that trend, shares of gaming giant Activision Blizzard (ATVI) had grown three-fold in the past five years to reach a peak earlier this month. And, all the long-term investors out there must be happy about it.
It was after a great deal of hype the California-based tech firm finally unveiled its new Call of Duty franchise recently, in a launch that outshined all the previous ones. Ironically, nearly a week after the launch, it has wiped out several millions of dollars in market value from the company. The stock fell sharply in the early trading hours Thursday as the ongoing selloff intensified, reversing much of the recent gains.
The California-based tech firm unveiled its new Call of Duty franchise recently, in a launch that outshined all the previous ones
Call to Duty Black Ops-4, as the latest version of the first-person shooter is christened, generated sales worth $500 million in the first three days the blockbuster launch, which was also the biggest day-one digital release for the company. However, the overall sales numbers fell short of expectations. Though the market was buoyed by the initial results, uncertainty over the performance of the non-digital versions triggered speculation.
Some market watchers see a quick recovery once the company brings more clarity into the sales numbers, especially considering the high user engagement and robust digital sales. Many blame the inappropriate timing of the release for the not-so-impressive sales. It’s true that the early launch, unlike in the previous years when it always happened in the month of November, has taken off the benefit of the upcoming holiday season to some extent.
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Also, the absence of single-player mode in the new version has come as a dampener for many Call of Duty fans. Despite all that, the general sentiment about the stock is bullish, with the main attraction being the early engagement
Activision shares reached an all-time high early this month, after making major gains over the last several months. The stock dropped nearly 8% during the regular session Thursday.