May 7, 2010 3:43 am

Activision expects new game to be bestseller

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The head of Activision Blizzard said on Thursday that a revolt at the studio responsible for the record-breaking Call of Duty: Modern Warfare 2 would not adversely affect the world’s biggest video game publisher.

Bobby Kotick, chief executive, also forecast that the next instalment of the Call of Duty franchise – Black Ops – would outsell Halo: Reach when the two blockbuster action games are released in the autumn, and would become the biggest video game of the year.

Activision released first-quarter figures well ahead of analysts’ expectations and its own guidance.

The south California-based company reported revenues of $714m, for earnings per share of 9 cents, against its forecast in February for $525m sales and profits of 2 cents a share.

In mid-April it said it was tracking ahead of its outlook, leading to analyst expectations of sales of $563m and earnings per share of 4 cents.

Activision said its better-than-expected performance was due to “strong global consumer demand” for Call of Duty and Blizzard Entertainment’s World of Warcraft online game.

Activision shares have fallen 12 per cent in the past month over concerns about the defection of the creators of Modern Warfare 2, which has generated more than $1.5bn in revenues. About a quarter of the staff at its Infinity Ward studio have left following the firing of its studio heads two months ago.

The company has alleged in a lawsuit that Vincent Zampella and Jason West were trying to “steal the studio” and had secretly met top executives of its rival Electronic Arts. Since their dismissal, the two have launched a studio called Respawn and announced the backing of EA for a new game in the action genre.

The former executives are suing Activision for damages and unpaid royalties, while 38 Infinity Ward employees are also suing the company for allegedly delaying and withholding more than $54m in royalties for Modern Warfare 2. They claim they are being “held hostage” by the publisher.

Mr Kotick said the company had no choice but to sack the executives for insubordination and breach of contract, but the franchise would not be affected.

“It’s a magnet for talent, we have a lot of other [studio] resources, we don’t think we will see a blip,” he said.

Activision has alternated development of Call of Duty games with its Treyarch studio, developer of this year’s Black Ops.

“I’m comfortable Call of Duty: Black Ops will be the biggest video game of the year,” he added. The title is available on multiple platforms, while Halo: Reach is exclusive to Microsoft’s Xbox 360 console.

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