Diablo III will pick up the story twenty years after the events of Diablo II. Mephisto, Diablo, and Baal have been defeated, but the Worldstone, which once shielded the inhabitants of the world of Sanctuary from the forces of both the High Heavens and the Burning Hells, has been destroyed, and evil once again stirs in Tristram. Playing as a hero from one of five distinct character classes, players will acquire powerful items, spells, and abilities as they explore new and familiar areas of Sanctuary and battle hordes of demons to safeguard the world from the horrors that have arisen.
In the 2012 Financial Results investors conference call Activision CEO Bobby Kotick conformed that Blizzard is workinfg on an expansion for Diablo III, but no further details were provided.
Activision Blizzard announced better-than-expected financial results for the third quarter of 2012. For the quarter ended September 30, 2012, the company delivered record GAAP net revenues of $841 million, as compared with $754 million for the third quarter of 2011. On a non-GAAP basis, the company’s net revenues were $751 million, as compared with $627 million for the third quarter of 2011. For the third-quarter, GAAP net revenues from digital channels were $430 million and represented 51% of the company’s total net revenues. On a non-GAAP basis, net revenues from digital channels were $427 million and represented 57% of the quarter’s total net revenues.
For the quarter ended September 30, 2012, Activision Blizzard delivered record GAAP earnings per diluted share of $0.20, as compared with $0.13 for the third quarter of 2011. On a non-GAAP basis, the company also delivered record earnings per diluted share of $0.15, as compared with $0.07 for the third quarter of 2011. Both GAAP and non-GAAP earnings include a one-time tax benefit of $46 million, or $0.04 per diluted share, resulting from the closure of an IRS audit related to pre-merger net operating losses from Vivendi Games.
The company reports results on both a GAAP and a non-GAAP basis. Please refer to the tables at the back of this press release for a reconciliation of the company’s GAAP and non-GAAP results.
Robert Kotick, Chief Executive Officer, Activision Blizzard, said, “Our unyielding commitment to excellence, the strength of our employees around the globe and our focus on creating great entertainment experiences have enabled us to once again deliver better-thanexpected financial results. We have, for the third straight year, generated over $1 billion of operating cash flow for the trailing twelve month period ending September 30. Our performance was driven by the launch of Blizzard Entertainment’s World of Warcraft: Mists of Pandaria and continued sales of its top-selling PC game, Diablo III, as well as Activision Publishing’s new entertainment property, Skylanders Spyro’s Adventure, and sales of titles in the Call of Duty franchise. Based on our strong third-quarter performance and increased visibility into the remainder of the year, we are raising our full-year financial outlook and expect to deliver record non-GAAP operating margins and the highest non- GAAP earnings per share in our company’s history. We now expect non-GAAP earnings per share will increase more than 18% year over year.”
Kotick added, “Skylanders Giants is off to a great start and next week the company will release Call of Duty: Black Ops II, which we believe will be one of the most successful launches of any form of entertainment in history.”
Kotick continued, “As we look to 2013, we are cautious about business prospects given a continuingly challenged global economy, the ongoing console transition and very difficult year-over-year comparables due to Blizzard’s record-shattering Diablo III sales in 2012. We expect that over the long-term, we will maintain our leadership position as the world’s leading interactive entertainment company and continue to provide strong returns to our shareholders by delivering great games to audiences around the world.”
Selected Business Highlights
- Activision Publishing’s Skylanders Spyro’s Adventure has been the #1 best-selling console and handheld game overall in dollars, including accessory packs and figures, in North America and Europe for the first nine months of 2012.¹ Additionally, Skylanders Spyro’s Adventure was the #1 action-figure line in the U.S., outselling all other action–figure lines for the first nine months of 2012.
- For the first nine months, Activision Blizzard was the #1 PC publisher in the U.S. and Europe. Additionally, for the third quarter, Blizzard Entertainment had two of the top five PC games with Diablo III and World of Warcraft: Mists of Pandaria.
- Since its release in May 2012, Blizzard Entertainment’s Diablo III was the #1 bestselling game in dollars and units on the PC in the U.S. and Europe.
- On September 25, 2012, Blizzard Entertainment released World of Warcraft: Mists of Pandaria, and sold through approximately 2.7 million copies of the game as of its first week of release.³ Additionally, on October 2, 2012, World of Warcraft: Mists of Pandaria was released in China, marking what the company believes to be the first time any game has officially released in China as part of a global launch.
- As of September 30, 2012, Blizzard Entertainment’s World of Warcraft remains the #1 subscription-based MMORPG, with more than 10 million subscribers.
- During October, Activision Publishing released several new titles including: 007 Legends on October 16, 2012; Skylanders Giants™ on October 22, 2012; Cabela’s Dangerous Hunts 2013 and Cabela’s Hunting Expeditions on October 23, 2012; and Transformers Prime™ on October 30, 2012.
On November 13, 2012, Activision Publishing expects to release its highly anticipated game, Call of Duty: Black Ops II, the most ambitious Call of Duty game ever. Additionally, Activision Publishing expects to release Wipeout 3 on November 18, 2012 and Family Guy: Back to the Multiverse on November 20, 2012.
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