Activision-Blizzard Q2 2020: Year-over-year revenues are up for the first time in six quarters

    
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Activision-Blizzard Q2 2020: Year-over-year revenues are up for the first time in six quarters

We’re back with another dip into Activision-Blizzard’s financials, this one Q2 2020, the first report since shareholders lambasted the company for excessive executive pay and the first report since BlizzCon 2020 was outright canceled.

MMO readers will recall that Q1’s report was heavily focused on on COVID-19 impacts and talking up better-than-expected returns, but as we’ve covered, 2019 saw mass layoffs, the Blitzchung boycott, a weak BlizzCon, and plunging YOY revenues for five straight quarters in May 2019, August 2019, November 2019, February 2020, and May 2020, though Q1’s revenue drop was very slight and close to flattening, which at the time we said might mark a corner corner-turn for the company, especially given the lockdowns this past spring.

And we were right, as second quarter 2020 revenues for Acti-Blizz are up a lot compared to both Q2 2019 and Q2 2018. COVID-19 lockdowns were good to the company. As usual, Activision-Blizzard characterized the gains as “significantly” exceeding its outlook thanks chiefly to Call of Duty and the pandemic (pandemic “tailwinds” seems to be the word of the moment).

“For the quarter ended June 30, 2020, Activision Blizzard’s net revenues presented in accordance with GAAP were $1.93 billion, as compared with $1.40 billion for the second quarter of 2019. GAAP net revenues from digital channels were $1.59 billion, as compared with $1.09 billion for the second quarter of 2019. GAAP operating margin was 39%. GAAP earnings per diluted share were $0.75, as compared with $0.43 for the second quarter of 2019. For the quarter ended June 30, 2020, on a non-GAAP basis, Activision Blizzard’s operating margin was 42% and earnings per diluted share were $0.81, as compared with $0.53 for the second quarter of 2019. For the quarter ended June 30, 2020, operating cash flow was $768 million. For the trailing twelve-month period, operating cash flow was $2.14 billion.”

For those wanting to keep track of MAUs (monthly active users) across all of Blizzard’s games (rather than Activision on the whole), there’s not much to see here, as they remain flat, at 32M, where they’ve now been for a whole year. Most of the MAU growth is coming from other corners of Activision, in other words.

38M in Q1 2018
37M in Q2 2018
37M in Q3 2018 (BFA)
35M in Q4 2018 (mass layoffs)
32M in Q1 2019
32M in Q2 2019
33M in Q3 2019 (WoW Classic)
32M in Q4 2019 (Blitzchung)
32M in Q1 2020 (COVID-19)
32M in Q2 2020 (COVID-19)

World of Warcraft reach and engagement once again increased sequentially, as shelter-at-home conditions further boosted the franchise’s strong trajectory,” Blizzard says. “The Shadowlands expansion saw an enthusiastic response from players in its public testing, with pre-sales accelerating even further ahead of its release in the fourth quarter. Franchise engagement is the highest in a decade at this point ahead of an expansion. Hearthstone’s Ashes of Outland expansion launched alongside a new hero class, as the expanded team continued to accelerate the pace of innovative content in the franchise. Overwatch engagement grew year-over-year, including among returning players.”

We’ll update more with the conference call once it’s begun.

Updates from the call
Bobby Kotick kicked things off by pointing out Acti-Blizz now counts half of its overall playerbase as female. Huh.

We didn’t get a clear revenue breakdown for Blizzard (now we have done; see pics above), but the call did clarify that engagement with WoW is apparently the highest it’s been in the lead-up to an expansion in a decade.

Blizzard is planning a company playtest for Diablo Immortal “in the coming weeks.” (It had been promising regional alpha testing by mid 2020 for the last two quarters.)

There’s that pandemic “tailwinds” again, heh. Yeah, most of Activision-Blizz is still working from home.

World of Warcraft is driving Blizzard’s revenue gains once again: It’s up 20% year-over-year.

No hard date for WoW Shadowlands again, just another confirmation of Q4.

Multiple questions about the pandemic’s impact on Blizzard specifically, requesting updates on the company’s upcoming titles, especially in light of BlizzCon’s cancellation. J. Allen Brack says it’s hard to measure how those are coming along, given work-from-home conditions, but the Diablo and Overwatch teams are working away. No real updates there at all. He does reiterate that there will be some sort of virtual event early in 2021.

More on Diablo – the analyst asked for details on the regional testing plan. I have no idea how Brack can talk so much and say so little, but he does. No clear answer to the actual question here either.

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Godnaz
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Godnaz

Vote with your wallet has failed and the industry knows it.

Just keep talking about the issues seems to work better. When the topic of injustice keeps getting brought up, consumers become more aware of their purchase choice. The industry is unable to go silent and change does happen.

Yangers
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Yangers

Glad to see people are voting with their wallets. /s

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Arktouros

Hasn’t even been a year.

Boycott Blizzard lololol…

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starbuck1771

Don’t you mean Activision after all they are the one’s handing down the orders.

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Schlag Sweetleaf

.

You better be here to make me money..jpg
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Dug From The Earth

You seriously should have your own website where people could go to see a catalog of your spot on work.

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starbuck1771

Or even commission him to do work.

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Schlag Sweetleaf

I’d much rather see something on this site to promote community. Been here doing what I do for 5+ years so i don’t forsee anything coming other than more of the same. i’m at peace with it now, I used to rail about it a bit, even if i would have had a heads up on stories to come to give me more time to make something better.. thats not going to happen here for me, and thats cool. i do believe this community deserves something unique, as this site and how it came about is unique.

thank you for the thought thogh. Fostering mmo journalism doesnt apply to the cartoonist here though, and again thats cool

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Schlag Sweetleaf

i hid five actiblizz game references in here, did you happen to see any?

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Dug From The Earth

Diablo 3 ring?
Bobby’s face
Hearthstone on the hat
That logo on the chest ( is that call of duty?)
not sure of the 5th

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Schlag Sweetleaf

:)

yes bobbys face on WoW’S Goblin prince

hearthstone: yup

call of duty: yup , loot crate from older version

ring: those are candies from candy crush

# 5 is weaksauce on my part, the diamond earing is a flawless royal from Diablo 3.

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Schlag Sweetleaf

actually 6, forgot faded overwatch symbol on scepter:0 thanks for playing, Dug

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Rick Mills

“…with pre-sales accelerating even further ahead of its release in the fourth quarter.”

Wait, what? I thought this was a summer/fall release.

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starbuck1771

It’s summer now almost fall. First official day of fall is next month.

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Rick Mills

the fourth quarter.

that’s Oct-Dec

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Schmidt.Capela

Fall in the Northern Hemisphere goes from September 22 to December 21. Which covers all but the last 10 days of Q4.

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starbuck1771

Correct thank you

Leo
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Leo

So now that they are doing good, how many employees are they going to fire this time?

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Bruno Brito

Bobby Kotick kicked things off by pointing out Acti-Blizz now counts half of its overall playerbase as female. Huh.

Ugh.

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starbuck1771

Welcome to Covid-19. More players and money due to no school or job’s. Gotta do something to fight the boredom. Might as well play games. 😋

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Bruno Brito

Yeah? My problem is just demon-horned Kotick being the one to point this out.

Aldristavan
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Aldristavan

I’m sure that the Activision-Blizzard employees on food stamps will be thrilled at this news!

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Greaterdivinity

Bobby Kotick kicked things off by pointing out Acti-Blizz now counts half of its overall playerbase as female. Huh.

Hooray, Blizzard solved sexism in gaming!

/s

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starbuck1771

Not really but who knows.