Activision Blizzard has issued a financial report for the third quarter ended September 30, 2022. The company saw its revenue and profit fall year-over-year, largely due to Activision’s weaker performance.

Activision Blizzard saw its revenue and profit fall in Q3

Financial highlights

  • The company’s net revenue was $1.78 billion, down 13.9% year-over-year.
  • Game sales accounted for only around 13% of total revenue, down 45.3% year-over-year.
  • In-game purchases, subscriptions, and other sources of revenue amounted to $1.55 billion, or 87% of the total, down 7.3% year-over-year.
  • It is worth noting that digital sales (digital copies of premium games, DLCs, microtransactions, etc.) accounted for 90% of Activision Blizzard’s total revenue.
  • The company generated only $25 million from retail channels and $151 million from other distribution channels, which primarily include the Overwatch League and the Call of Duty League.
  • Activision Blizzard reported net income of $435 million, down 31.9% from the same period in 2021.
  • The company’s total monthly active users (MAU) were 368 million, down 5.6% year-over-year.

The company’s results by segments

  • When looking at the results of the company’s operating segments, Activision recorded net revenue of $480 million, down 25.1% year-over-year.
  • Blizzard reached $543 million in net revenue, up 10.1% from the same period in 2021.
  • King remained the leader in terms of revenue, generating $692 million in the third quarter (up 6.1% year-over-year).
  • Activision cited “reduced engagement” for Call of Duty following the weaker reception of Vanguard as the main reason for its lower performance year-over-year.
  • However, the company expects the numbers to grow again in the next quarter thanks to impressive sales of Modern Warfare II.
  • Blizzard’s growth was due to the successful launch of Diablo Immortal, while Warcraft franchise bookings were “stable” year-over-year.
  • Blizzard also noted that its licensing agreements for publishing games in China expire in January 2023: “We are in discussions regarding the renewal of these agreements, but a mutually-satisfactory deal may not be reached.” However, this won’t affect Diablo Immortal, which is covered by a separate agreement.
  • King’s growth was due to “ongoing strong execution across live operations and user acquisition.” The segment’s payer numbers also increased by a double-digit percentage year-over-year.
  • Candy Crush had 200 MAU, with the company hoping to drive further growth with new content updates.

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