Video game publisher Activision Blizzard, Inc (ATVI) late Wednesday said its second quarter operating income fell 34% from last year, but adjusted results still narrowly beat analyst expectations.
The Santa Monica-based company reported second quarter net income of $195 million, or 15 cents per share, while its adjusted profit was 8 cents per share. Total revenue was $1.04 billion, while adjusted sales were $801 million.
On average, Wall Street analysts expected slightly lower adjusted profits of 7 cents per share, on matching revenue of $801 million.
On an operating basis, income was $156 million, down 34% percent from last year's $235 million. On the same basis, revenue fell 20% to $801 million from $999 million last year.
Activision said it would delay the release of two upcoming video games into 2010, and as a result lowered its full-year revenue forecast. It now expects full-year revenue of $4.05 billion, down from a prior forecast for $4.3 billion. On an adjusted basis, the company sees revenue of $4.5 billion, down from a previous outlook of $4.8 billion, and falling short of analyst estimates for $4.87 billion.
Despite the lowered revenue guidance, Activision raised its full-year profit outlook to 26 cents per share from 24 cents, and reaffirmed its adjusted profit forecast of 63 cents per share. Analysts currently expect a higher 66 cents per share.
For the third quarter, the company forecast a net loss 3 cents per share on sales of $680 million, but an adjusted profit of 3 cents per share on $700 million in revenue. This guidance also falls short of analysts' view for adjusted profits of 10 cents per share on much higher sales of $909.5 million.
Activision shares rose 74 cents, or +6.5%, in morning trading Thursday.
The Bottom Line
Shares of ATVI are off 52-week highs of $19 a share. The stock has technical support in the $10 price area. If the shares can firm up, we see overhead resistance around the $14-15 price levels. We do not currently rate this non-dividend paying stock, but we do follow the videogame publisher closely.
Activision Blizzard, Inc (ATVI) does not currently pay a dividend.
Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.
Related Stories
