Activision Blizzard Beats Analyst Estimates on EPS

Activision Blizzard (Nasdaq: ATVI  ) reported earnings on Feb. 7. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Activision Blizzard whiffed on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue dropped significantly and GAAP earnings per share grew significantly.

Margins increased across the board.

Revenue details
Activision Blizzard notched revenue of $1.77 billion. The 22 analysts polled by S&P Capital IQ hoped for revenue of $2.44 billion on the same basis. GAAP reported sales were 26% higher than the prior-year quarter's $1.41 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.78. The 24 earnings estimates compiled by S&P Capital IQ predicted $0.72 per share. GAAP EPS of $0.31 for Q4 were 288% higher than the prior-year quarter's $0.08 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 61.4%, 1,270 basis points better than the prior-year quarter. Operating margin was 27.4%, 2,470 basis points better than the prior-year quarter. Net margin was 20.0%, 1,300 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $710.4 million. On the bottom line, the average EPS estimate is $0.10.

Next year's average estimate for revenue is $4.56 billion. The average EPS estimate is $0.97.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 6,944 members out of 7,173 rating the stock outperform, and 229 members rating it underperform. Among 1,511 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,475 give Activision Blizzard a green thumbs-up, and 36 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Activision Blizzard is outperform, with an average price target of $15.08.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool recommends Activision Blizzard. The Motley Fool owns shares of Activision Blizzard. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On February 08, 2013, at 12:45 AM, AB69Fool wrote:

    You must be short atvi. Your numbers don't re revenue don't jibe with the CFO. Please review and explain.

  • Report this Comment On February 08, 2013, at 7:02 AM, ChipNPutt11 wrote:

    Seth,

    Revenues according to John Ballard;

    Q4 2012 Earnings update

    Q4 Net revenues (non-GAAP) --- $2.6 billion, up 7.9%

    Full year net revenues --- $4.99 billion, up 11.1%

    Q4 EPS --- $0.78, up 25.8%

    Full year EPS --- $1.18, up 26.9%

    Whiff??

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