Activision Blizzard raised its 2011 forecasts as the most highly anticipated video game of the year, Call of Duty: Modern Warfare 3, went on sale and the publisher reported strong demand for a new toy-based title targeted at the holiday season.
The world’s largest video game publisher by revenues said there had been an unprecedented level of pre-orders for the latest title in the Call of Duty franchise and a stronger than expected consumer response to Skylanders: Spyro’s Adventures, where smart action figures interact with the game.
Modern Warfare 3 went on sale in the early hours of Tuesday with midnight store openings. Amazon reported more pre-orders for the game than any other in the online retailer’s history.
Video game analysts at Wedbush Securities forecast that Modern Warfare 3 will at least match the 25m units sold of its predecessor, Call of Duty: Black Ops. On its first day a year ago, 5.6m units were sold. Revenues of $360m set a one-day record for any entertainment property.
The publisher, based in Santa Monica, California, publisher raised its calendar-year revenue guidance by $200m to $4.25bn and increased its earnings per share forecast from 77 to 85 cents.
Activision also reported third-quarter figures well ahead of Wall Street expectations. Sales of $627m compared with an analyst consensus of $558m. Earnings of 7 cents a share, compared with 2 cents a share expected by analysts.
However, Activision shares fell 3 per cent to $13.48 in extended trading in New York after the company’s Blizzard division reported continuing and more rapid declines in subscriptions to another mainstay – the World of Warcraft online role-playing game.
Global subscriptions, which were over 12m at the start of the year, declined to 10.3m in the third quarter, down 7 per cent from 11.1m in the second quarter.
Mike Morhaime, Blizzard president, said the majority of the declines were coming from the Asia, where China represented more than half of the global player base. He told analysts a number of initiatives, including marketing promotions and content improvements, were planned.
Learning from the success of World of Warcraft’s subscription model, Activision launched Call of Duty Elite on Tuesday, with a $50-a-year premium subscription for the social network for players of the game. Activision said it was struggling to cope with demand for the new service, with more than 1m people already registered.
Bobby Kotick, chief executive, told the Financial Times that supplies were already tight for some of the 32 different characters that can be bought to be played in the Skylander game, with the company and toy retailers not expecting such strong sales ahead of the US Thanksgiving holiday – the game was released in mid-October.
“It’s shaping up to be not only the most in-demand game for six to 11-year-olds but also the most in-demand toy – those sales have been great,” he said.