Activision-Blizzard’s mixed results in the esports space may be a continuing theme with both Overwatch and Call of Duty facing challenges, but the overarching health of the company is extremely good according to their financial report for the first quarter of 2021. Its net revenue through March 2021 was $2.28bn, up from $1.79bn in the same period of 2020, mainly based on the excellent performance of the Call of Duty franchise.
Call of Duty titles carry Activision Blizzard Q1 revenue
In particular, the release of Warzone as a free-to-play title seems to have revitalized an already robust title, with the Activision segment revenue up 72% on last year, driven by Black Ops Cold War, Warzone, and Call of Duty Mobile. While fans can and often will complain about the quality of console releases, there is no doubt the CoD mobile title is an industry leader in terms of gameplay experience on a mobile device.
According to their quarterly call, "The introduction of Call of Duty free-to-play and mobile experiences has transformed the franchise, more than tripling franchise MAUs (monthly active users) over the last two years, and leading Activision to a new record of 150 million MAUs in the first quarter." The release of CoD Mobile in China also gave the company access to a massive new customer base, with the Activision segment in rude health going into Q2 of this year.
Blizzard games losing playerbase
By comparison, the Blizzard arm of the company grew by just 7%, with the majority of that success attributed to the evergreen World of Warcraft franchise. The overall Blizzard playerbase is also in some form of decline, with the company having lost 29% of its active player base in the last three years across a variety of franchises, which sits in sharp comparison to the booming health of Activision.
One not of interest to Overwatch fans, given the relative lack of growth that game has seen compared to CoD, is Activision-Blizzard’s assertion that "our increased investment in our largest franchises is enabling us to connect and engage people in more ways than ever before." Despite Activision claiming the game has gained 10M users since November 2019 for a total of 60M as of 2021, the game just lost its game director in Jeff Kaplan and there's no telling when Overwatch 2 will launch.
Call of Duty Major IV LAN coming
In somewhat related news, the company has also announced their plans for the first Call of Duty LAN of 2021, with the Dallas Empire set to host the Major IV at the Esports Stadium Arlington from June 17-20, 2021. Only teams and limited league staff will be in attendance in accordance with guidelines, and the company also plans to have Rapid Response COVID-19 testing throughout the event, which will be streamed exclusively on YouTube.
The report projects products and services sold for 2021 to amount to over $8.5bn, demonstrating the incredible strength of the group and in particular the Call of Duty franchise. The addition of Warzone has added a free gateway for console users to get into the ecosystem, encouraging users to spend both in Warzone as well as buying Cold War itself for the PVE and PVP aspects therein.
The company does advise there are a number of factors, chiefly COVID, that could negatively impact results going forward, and caution that the same condition could prevent them from delivering "popular, high-quality titles in a timely manner", but 2021 seems to suggest they aren’t struggling to adapt to the new normal in the way other companies have. If you’d like to read the full investor call transcript, you can here.