Shulou(Shulou.com)11/24 Report--

Beijing time on November 8 morning news, Activision Blizzard today announced the company's financial results for the third quarter of 2022. According to the report, Activision Blizzard's third-quarter net revenue was $1.782 billion, compared with $2.07 billion in the same period last year; net booked income (net bookins) was $1.83 billion, compared with $1.88 billion in the same period last year, down 3 per cent from a year earlier, excluding currency changes. Net profit was $435 million, down 32 per cent from $639 million in the same period last year.

Activision Blizzard's third-quarter net booked income and adjusted earnings per share both beat Wall Street analysts' expectations, pushing its shares up less than 1 per cent in after-hours trading.

Performance Summary:

Activision Blizzard's net profit for the quarter ended September 30 was $435 million, or 56 cents per diluted share, better than in the same period last year. In the third quarter of fiscal 2021, Activision Blizzard posted net income of $639 million, or 82 cents per diluted share.

Excluding some one-time items (not in accordance with GAAP), Activision Blizzard's adjusted earnings per share in the third quarter were 68 cents per share, compared with 89 cents per share in the same period last year, which beat analysts' expectations. On average, 24 analysts had expected Activision Blizzard to earn $0.50 a share in the third quarter, according to data provided by Yahoo Finance.

Activision Blizzard had net revenue of $1.782 billion in the third quarter, compared with $2.07 billion in the same period last year.

By business unit, Activision Blizzard's third-quarter net revenue from product sales was $231 million, compared with $423 million in the same period last year, and revenue from in-game, subscription and other businesses was $1.551 billion, compared with $1.647 billion in the same period last year.

Divided by distribution channels, Activision Blizzard's net revenue from digital online channels in the third quarter was $1.606 billion, down 13% from the same period last year, accounting for 90% of the total net revenue. Compared with the same period last year, the net revenue from digital online channels was $1.852 billion, accounting for 89% of the total net revenue. Net revenue from retail channels was $25 million, down 64% from a year earlier, accounting for 1% of total net revenue, compared with $69 million from retail channels in the same period last year. Net revenue from other channels was $151 million, up 1 per cent from a year earlier and accounting for 8 per cent of total net revenue, compared with $149 million from other channels in the same period last year, accounting for 7 per cent of total net revenue.

By platform, Activision Blizzard's net revenue from game consoles in the third quarter was $336 million, down 36% from a year earlier, accounting for 19% of the total net revenue, compared with $523 million from game consoles in the same period last year. 25% of the total net revenue Net revenue from PC was $363 million, down 37% from a year earlier, accounting for 20% of total net revenue, compared with $578 million from PC in the same period last year, accounting for 28% of total net revenue. Net revenue from mobile and affiliated platforms was $932 million, up 14% from a year earlier, accounting for 52% of total net revenue, compared with $820 million from mobile and affiliated platforms in the same period last year. 40% of total net revenue Net revenue from other platforms was $151 million, up 1 per cent from a year earlier and accounting for 8 per cent of total net revenue, compared with $149 million from other platforms in the same period last year, accounting for 7 per cent of total net revenue.

By region, Activision Blizzard's net revenue from the Americas in the second quarter was $999 million, down 14 per cent from $1.166 billion a year earlier, and accounted for 56 per cent of total net revenue, compared with 56 per cent in the same period last year. Activision Blizzard's net revenue from the EMEA region was $498 million in the second quarter, down 20 per cent from $619 million a year earlier, and accounted for 28 per cent of total net revenue, compared with 30 per cent a year earlier. Activision Blizzard's net revenue from the Asia-Pacific region was $285 million in the second quarter, unchanged from $285 million a year earlier, and accounted for 16% of total net revenue, compared with 14% a year earlier.

Activision Blizzard's third-quarter net booked revenue (Net Bookings) was $1.83 billion, compared with $1.88 billion in the same period last year, down 3% from a year earlier, excluding currency changes, which exceeded analysts' expectations. On average, 20 analysts expected Activision Blizzard's net revenue to reach $1.69 billion in the third quarter, according to data provided by Yahoo Finance.

Activision Blizzard's third-quarter operating profit was $485 million, compared with $824 million in the same period last year, with an operating margin of 27%. Excluding some one-time items (not in accordance with GAAP), Activision Blizzard's adjusted operating profit margin was 34% in the third quarter.

Other financial information:

Activision Blizzard's operating cash flow was $257 million in the third quarter, compared with $521 million in the same period last year.

Overall, Activision Blizzard had 368 million monthly active users (MAU) in the third quarter.

Activision Blizzard's total costs and expenses were $1.297 billion in the third quarter, compared with $1.246 billion in the same period last year. Of this total, in terms of revenue cost of product sales, the product cost was $107 million, compared with $120 million in the same period last year, and the cost of software royalties, amortization and intellectual property licensing was $9 million, compared with $72 million in the same period last year. In terms of in-game, subscription and other revenue costs, game operating and distribution costs were $343 million, compared with $307 million a year earlier, and software royalties, amortization and intellectual property licensing costs were $43 million, compared with $28 million a year earlier.

In terms of expenditure, Activision Blizzard spent $277 million on product development in the third quarter, compared with $329 million in the same period last year, and $287 million on sales and marketing, compared with $244 million in the same period last year. General and administrative expenses were $229 million, compared with $143 million in the same period last year. Restructuring and related expenses were $2 million, compared with $3 million in the same period last year.

Microsoft acquisition transaction:

Microsoft plans to buy Activision Blizzard in an all-cash deal of $95.00 a share, based on a deal previously announced on January 18, 2022. The transaction is subject to the usual closing conditions and is subject to regulatory review. The deal has been approved by Activision Blizzard and Microsoft's board of directors as well as Activision Blizzard shareholders and is expected to be completed within Microsoft's fiscal year ending June 30, 2023.

Changes in stock prices:

Activision Blizzard shares fell $0.86, or 1.20%, to $71.10 in regular trading. Activision Blizzard shares rose 44 cents, or 0.62 per cent, to $71.54 in after-hours trading as of 06:05 et on Monday (07:05 on Tuesday, Beijing time). Activision Blizzard has been priced from $86.90 to $56.40 over the past 52 weeks.

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