Activision
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Documents about Activision
Our Industry News (17/07/23 - 23/07/23)
The publication serves as a weekly industry briefing, summarizing key developments in the gaming sector for the week of 17–23 July 2023.
- Microsoft has secured a 10-year agreement to keep Call of Duty on PlayStation following its acquisition of Activision Blizzard.
- The UK Competition and Markets Authority has initiated a six-week review of Microsoft’s revised cloud gaming proposal.
- Xbox Live Gold will be rebranded as Game Pass Core on 14 September, with pricing set at £10 monthly or £60 annually.
#218: Get the Papers
This industry update provides a comprehensive overview of major developments in the gaming sector as of July 2023.
- Microsoft and Activision have extended their merger deadline to October 18, 2023, following the FTC's decision to drop its administrative challenge to the deal.
- Activision Blizzard reported a 34% revenue increase for the first half of 2023, driven by the success of Diablo IV, which helped Blizzard achieve its first billion-dollar quarter.
- Sony has signed a ten-year binding agreement to keep the Call of Duty franchise on PlayStation platforms.
Google Play vs. App Store Blockchain Policies / New Game Development Models
The gaming industry is currently undergoing a dual transformation driven by the rapid adoption of generative artificial intelligence and the complex integration of blockchain technology.
- Generative AI and tools like the Unreal Editor for Fortnite are significantly accelerating development cycles, which lowers entry barriers but intensifies competition and makes user acquisition more difficult.
- Market power is increasingly consolidating around established brands and creators who can leverage existing, loyal audiences to overcome the rising volume of content.
- Google Play and the Apple App Store have begun permitting NFT sales and blockchain features, but they maintain strict, restrictive oversight on in-app payments, token-gated content, and loot box mechanics.
Activision Blizzard Q2 2023 Financial Results
Activision Blizzard’s financial results for the second quarter of 2023 demonstrate significant growth across all primary metrics, largely propelled by the successful launch of Diablo IV.
- Activision Blizzard reported $2.2 billion in Q2 2023 net revenue, a 34% year-over-year increase, driven by a 50% rise in net bookings to $2.46 billion.
- The Blizzard segment achieved its first $1 billion quarterly revenue milestone, marking a 168% year-over-year increase fueled by the launch of Diablo IV, which reached over 10 million players in June.
- Operating income grew by 72.4% to $583 million, with digital sales accounting for 91% of total revenue.
Microsoft, Activision Blizzard Extend Deal Deadline to October
Microsoft and Activision Blizzard have formally extended the deadline for their proposed $69 billion acquisition from July 18 to October 18, 2023.
- Microsoft and Activision Blizzard have extended the deadline for their $69 billion acquisition from July 18, 2023, to October 18, 2023, to resolve remaining regulatory concerns.
- If the deal is not completed by August 29, Microsoft will owe a $3.5 billion termination fee, which increases to $4.5 billion if the deal remains incomplete by September 18.
- The extension allows both companies to address regulatory requirements in the UK, where Microsoft and the Competition and Markets Authority (CMA) have entered a two-month legal pause to negotiate a potential compromise.
Blizzard Entertainment Record Sales Boost Activision Blizzard Q2 Profits to $587M
Activision Blizzard reported strong financial performance for the second quarter of 2023, driven primarily by record-breaking sales within its Blizzard Entertainment segment.
- Activision Blizzard reported a net income of $587 million for Q2 2023, a 109.6% increase compared to $280 million in the same period of 2022.
- Total net revenue reached $2.21 billion, representing a 34.8% growth year-over-year from $1.64 billion.
- Blizzard Entertainment segment revenue surged 160% year-over-year to $1.05 billion, driven primarily by the launch of Diablo IV, which attracted over 10 million players in June.
Activision Blizzard Second Quarter 2023 Financial Results
Activision Blizzard achieved substantial financial growth during the second quarter of 2023, characterized by a 50 percent year-over-year increase in net bookings and a 34 percent rise in consolidated net revenues to $2.2 billion.
- Activision Blizzard's GAAP net revenues for Q2 2023 were $2.21 billion, a significant increase from $1.64 billion in Q2 2022.
- Call of Duty: Mobile has generated over $3 billion in lifetime worldwide consumer spending since its launch in October 2019.
- Activision's segment revenue grew 17% year-over-year in Q2 2023, with operating income increasing over 80%, primarily driven by the Call of Duty franchise.
Our Industry News (10/07/23 - 16/07/23)
The publication serves as a weekly roundup of notable developments within the gaming and entertainment sectors, covering the period from 10 to 16 July 2023.
- A federal judge cleared Microsoft’s acquisition of Activision Blizzard to proceed before the July 18 deadline, despite an ongoing appeal by the FTC.
- Microsoft considered extreme regulatory workarounds, including the potential withdrawal of Blizzard from the UK market, to secure the acquisition.
- Antstream expanded to Xbox Series X/S and Xbox One with a library of over 1,300 titles, highlighting a broader industry concern that 87% of classic games in the U.S. are currently out of print.
The Other Shoe Drops: Sony Agrees to 10-Year Call of Duty Deal for PlayStation Platforms
In July 2023, Microsoft and Sony reached a binding 10-year agreement to maintain the availability of the Call of Duty franchise on PlayStation platforms.
- Microsoft and Sony have signed a binding 10-year agreement to keep the Call of Duty franchise available on PlayStation consoles following Microsoft's acquisition of Activision Blizzard.
- This agreement removes the final major industry holdout, as Sony joins other platforms like Nintendo, Nvidia, and Valve in securing long-term access to the Call of Duty franchise.
- The deal represents a critical milestone for Microsoft's $69 billion USD acquisition of Activision Blizzard, significantly reducing the likelihood of successful opposition from global regulatory agencies.
FTC Licks Its Wounds: Google Embraces Blockchain Gaming
This analysis examines the shifting landscape of the gaming industry in mid-2023, specifically focusing on the implications of the Federal Trade Commission’s failed attempt to block Microsoft’s acquisition of Activision Blizzard and the subsequent pivot of major platforms toward blockchain integration.
- District Judge Corley denied the FTC’s request for a preliminary injunction against Microsoft, allowing the company to proceed with its acquisition plans.
- Google Play has updated its policy to permit apps with blockchain capabilities, signaling a strategic move to capture market share in crypto gaming.
- Companies like Mythical Games are actively working to simplify blockchain integration to facilitate the trade of in-game assets via cryptocurrency.
Microsoft Unblocked / FF16 Sales / Classic Game Archive Issues
The gaming industry is currently navigating a period of significant structural transition, marked by the consolidation of major publishers and the ongoing evolution of digital distribution models.
- The judicial clearance of Microsoft’s acquisition of Activision Blizzard is expected to trigger a new wave of large-scale industry consolidation.
- 87% of classic games released before 2010 are currently commercially unavailable, driven by poor internal asset management and the technical barriers of live-service infrastructure.
- Subscription services like Xbox Game Pass risk capping financial upside and altering game design incentives, likely pushing the industry toward a hybrid model of subscription and traditional retail.
Down. Not Out.: Regulators Pull Out All the Stops to Block the Activision Acquisition
This analysis examines the regulatory landscape surrounding Microsoft’s proposed acquisition of Activision Blizzard following a pivotal U.S. District Court ruling.
- The U.S. District Court’s denial of the FTC’s request for a temporary injunction has significantly increased the probability of Microsoft successfully acquiring Activision Blizzard.
- Regulators failed to provide sufficient evidence that the merger would substantially reduce competition or that Microsoft possesses a financial incentive to make Call of Duty an exclusive title.
- Market confidence in further industry consolidation grew following the ruling, evidenced by rising stock prices for major publishers including Electronic Arts and Take-Two Interactive.
Its games in the library
Call of DutyInfinity Ward · 2003566
Halo: Combat EvolvedBungie · 200117- Call of Duty: Modern Warfare 412
- Overwatch159
Call of Duty: Modern Warfare 3Sledgehammer Games · 20117
Call of Duty: Black OpsTreyarch · 201050
Call of Duty: Black Ops IITreyarch · 20123
Call of Duty: Modern Warfare 2Infinity Ward · 20099
Halo 3Bungie · 20074- Call of Duty: Black Ops 625
- Call of Duty: Black Ops 716
- Halo: Campaign Evolved4