Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Activision Blizzard
So what: After excluding some items, Activision Blizzard told investors to expect first-quarter earnings of $0.07 per share. Analysts were expecting $0.10 a share. The company also announced plans to cut 500 jobs. (Including more than a few of its former rockers, presumably.)
Now what: There's no spinning this record: The news stinks, especially when you consider the stellar numbers put up by gaming peer Take-Two Interactive
Take-Two, home of the Grand Theft Auto franchise and the more recent hit Red Dead Redemption, booked $0.52 in per-share earnings on $334 million in revenue. Both results easily beat estimates. By contrast, Activision Blizzard reported a narrower Q4 loss on lower revenue.
Bulls will argue that Activision ended its year producing more than $1 billion in free cash flow. They're right; that is impressive. But with lower guidance and the loss of what had been a great franchise, it's tough to blame the bears for biting.
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