Activision Blizzard earnings beat expectations on bottom line, but miss on Q4 outlook
Activision Blizzard (ATVI) reported its Q3 2021 earnings after the closing bell on Tuesday, meeting analysts’ expectations on the top line and beating on the bottom line. Here are the most important numbers from the report compared with what the street was looking for.
While Activision Blizzard saw a solid Q3, its Q4 outlook fell shy of analysts’ expectations, with the company calling for revenue of $2.78 billion in the quarter. Wall Street was looking for $2.95 billion. Expected earnings per share were also lower than analysts’ expectations, with the street calling for $1.39 per share for Q4, and Activision Blizzard pointing to $1.29.
Activision Blizzard is America’s largest video game company, and has found incredible success through its “Call of Duty,” “World of Warcraft,” and “CandyCrush” franchises. The company is set to launch its newest Call of Duty title, “Call of Duty Vanguard” on Nov. 5.
“I’m pleased to report strong third quarter results ahead of our prior outlook,” Activision Blizzard CEO Bobby Kotick said in a statement.
“We are excited about this week’s Call of Duty launch and expect continued success in the fourth quarter. I want to thank our employees for their continued commitment to each other, the company, and our players. We look forward to sharing progress updates on our workplace initiatives, alongside our business performance.”
Activision Blizzard has been weathering the fallout from a sexual harassment scandal. The California Department of Fair Employment and Housing filed a lawsuit against Activision Blizzard in July, alleging that the company fostered a “frat boy” culture that included sexual harassment and gender and racial discrimination. In September, the Equal Employment Opportunity Commission filed its own suit against the company over the allegations. Activision Blizzard is currently seeking an $18 million settlement in that complaint.
Separately, the Securities and Exchange Commission is looking into whether Activision Blizzard properly disclosed allegations of workplace harassment and pay disparities between men and women emplooyees.
The company has since said 20 individuals have left the company as a result of its investigations, that it has implemented a zero-tolerance harassment policy, ended forced arbitration for future sexual harassment and discrimination claims. Activision Blizzard also said it’s working to increase the percentage of women and non-binary people in its workforce by 50% in the next five years.
Kotick, who was previously one of the country’s highest paid CEOs, has also taken a pay cut, dropping his overall compensation to $62,500 until the board is satisfied with the company’s efforts. He was previously expected to earn $155 million.
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