Activision's upcoming Skylanders Academy television show. Image Source: Activision Blizzard
Activision Blizzard (ATVI +0.00%) featured a limited lineup at this year's Electronic Entertainment Expo, focusing on Call of Duty: Infinite Warfare, Skylanders: Imaginators, and Destiny: Rise of Iron. The publisher also unveiled its first push into film production with Skylanders Academy, an animated show that will launch on Netflix this fall and receive at least a two-season run.
Here's a rundown of what investors should know about the company's E3 2016 announcements.
Showing for Call of Duty should ease investor concerns
In May, Activision debuted Call of Duty: Infinite Warfare, the next mainline release in its premier first-person shooter series, to a largely negative reception. The game's showing at the expo should help to assuage investor concerns about the game's quality and prospective sales performance.
When the new Call of Duty was first shown, many fans of the series were disappointed that the game took place in a futuristic setting and placed an emphasis on space flight and traversal -- features that seemed alien to the series. A deeper look at Infinite Warfare suggests that, while it may not be exactly the game fans were clamoring for, the upcoming title still incorporates many of the hallmarks of the series and should have the chance to win fans over with its new features.
Sales of Infinite Warfare will likely fall short of last year's Black Ops 3, owing partially to the fact that Infinite will launch only on PlayStation 4, Xbox One, and PC plaftorms, but the upcoming game appears on track to be a quality release in the long-running series and should not threaten the brand simply by virtue of its setting.
The individual series that make up the Call of Duty franchise (Modern Warfare, Black Ops, Ghosts, among others) pack varying degrees of sales strength, and a movement in somewhat of a new direction with Infinite Warfare should probably not be taken as a worrying sign for investors, particularly as Activision continues to show strength with its other big first-person-shooter franchises, Destiny and Overwatch.
New Destiny content and great numbers for Overwatch
Activision used E3 to spotlight its upcoming Rise of Iron expansion pack for Destiny, and the update looks like it will help maintain the popularity of the publisher's lucrative shooter. Rise of Iron will not be launching on PlayStation 3 or Xbox 360, but the game's developer recently indicated that the game could come to PC in the near future -- a welcome addition as sales on last-gen console platforms wind down.
Activision also used E3 as occasion to announce that Overwatch had surpassed more than 10 million players. That's a great reception for the game, which launched at the tail end of May on PS4, Xbox One, and PC. Strong reviews and player feedback indicate that the game will have a long life cycle and the potential to generate significant digital revenue through downloadbale content and expansions.
Skylanders, film ambitions, and the return of a bandicoot
With Disney exiting video games and closing up its Infinity toys-to-life series, and Nintendo's Amiibo only compatible with Wii U and 3DS hardware, Activision's Skylanders and Time Warner's Lego Dimensions are now the only products in the category that are full multi-platform releases. Sales in the toys-to-life genre have showed signs of slowing in 2016, but Activision might have an opportunity to regain ground with one of its chief competitors exiting the space and a multimedia push for Skylanders under way.
Activision's upcoming release in the mainline series, Skylanders Imaginators, places an emphasis on character creation. Whether the new feature will prove to be a successful new hook for the series is unknown, but along with its recently released Skylanders Battlecast card game for mobile and its upcoming Skylanders Academy show on Netflix, Activision appears to be doing a commendable job of maintaining the property. The company's push into film and television production has big potential if executed properly and has huge value for a franchise like Skylanders.
Early news about Academy appears promising for the Skylanders series, as well as Activision's broader ambitions in film production. The Netflix series will feature the voice acting talents of Hollywood notables including Justin Long, Ashley Tisdale, Norm McDonald, and Susan Sarandon, among others, indicating that the show is being treated as a valuable extension of a core property and not a cheap tie-in. Activision is also developing films around Call of Duty and other properties, and the talent attached to Skylanders Academy and the show's high quality aesthetic would seem to portend well for future adaptations.
Activision is also teaming with Sony to bring Crash Bandicoot, the former PlayStation mascot and game star, back into the spotlight. The PlayStation 4 version of Skylanders Imaginators will reintroduce the beloved marsupial, followed by remakes of the first three games in the Crash Bandicoot series developed by Activision's Vicarious Visions studios. Activision still owns the rights to the character, so it has a potential long-term opportunity if it can help restore Crash's popularity.
Activision's post-E3 outlook
Activision's E3 presence was short on surprises, but the company did emerge from the year's biggest gaming event looking stronger than it went in. A compelling showing for Call of Duty: Infinite Warfare on the heels of last's month worrying debut should be somewhat comforting for investors, and early news surrounding the company's Skylanders Academy television show is a promising indication that Activision can successfully bridge some of its valuable intellectual properties into new mediums.
