Aug 8 (Reuters) - Videogame maker Activision Blizzard Inc beat second-quarter revenue estimates on Thursday, benefiting from higher investments in its franchises to fend off competition from blockbuster games “Fortnite” and “Apex Legends”.
The company, which labeled 2019 a “transition year” in May, cut 800 jobs during second quarter and spent heavily on developing its key game franchises “Call of Duty”, “Candy Crush”, “Overwatch”, “Warcraft”, “Hearthstone” and “Diablo”.
Activision also said in February the number of developers working on its games will increase by about 20% over the course of 2019.
“Beginning in the second half of this year our audiences will have a chance to see and experience the initial results of these efforts,” said Chief Executive Officer Bobby Kotick in the earnings statement on Thursday.
Activision raised its full-year forecast for adjusted profit to $2.15 per share, from $2.10, but reaffirmed revenue of $6.30 billion. Analysts were expecting a profit of $2.15 per share and revenue of $6.36 billion, according to IBES data from Refinitiv.
The company’s earnings follow upbeat results from rival publishers like Take-Two Interactive Software Inc and Electronic Arts Inc.
On Monday, Take-Two raised its full-year revenue forecast, boosted by the success of its franchises “NBA 2K”, “Grand Theft Auto V” and “Red Dead Redemption 2”, while EA reported better-than-expected quarterly revenue last week, riding on the continued success of its battle royale game “Apex Legends”.
Activision forecast third-quarter adjusted revenue of $1.10 billion and profit of 20 cents per share, missing analysts’ average estimate of $1.36 billion and 40 cents per share.
The company’s net income fell to $328 million, or 43 cents per share, in the quarter ended June 30, from $402 million, or 52 cents per share, a year earlier.
Excluding items, the company earned 38 cents per share.
Total adjusted revenue of $1.21 billion was above estimates of $1.19 billion. (Reporting by Sayanti Chakraborty in Bengaluru; Editing by Shinjini Ganguli)