Activision Blizzard Report Increased Revenue, But Confirm Fortnite Battle Royale Has Impacted
In Activision Blizzard’s May 3rd earnings call, they directly recognized the impact of popular battle royale games, particularly Fortnite, on their business.
The main titles in Activision Blizzard’s range include Overwatch, Call of Duty and World of Warcraft, as well as a wide range of other titles across console and PC.
Fortnite Battle Royale has of course become the most popular game across these platforms, and so it would come as little surprise that Activision is very much aware of its success.
However, it was maybe less expected for Activision to directly acknowledge the rise of Fortnite as ‘impacting’ their revenues.
The earnings call was made shortly after Activision Blizzard released their quarter one report for 2018, which did show impressive record revenues at an increase of 14% over last year, up to $1.97 billion GAAP net.
But where Fortnite and other battle royale games could be hurting Activision is by pulling away users. The report shows that the monthly active users were down 13% overall compared to last year.
During the call, the question was asked if Fortnite’s successful free to play model could signal a shift away from the tried and tested ‘$60 game’ model.
“We think in a growing industry like ours there is room for multiple business models.[…] We do believe $60 games will continue.”
So while some games in Activision Blizzard’s portfolio may be seeing less engagement and monthly active users, it is certainly still making the money that Activision will hope for, and that will satisfy the investors.
However, they will be acutely aware that if Fortnite continues on its path of wreckage in the industry, combined with big releases to come (Red Dead Redemption 2), a game plan change may be in order.
Activision $ATVI 2018 Q1:
CEO Bobby Kotick commented right off the bat on Fortnite. “It’s helping to grow gaming.” Then pivoted to saying the company’s games also retain players.
WoW is on a “strong trajectory.” Candy Crush is also.. crushing it. (Sorry.) pic.twitter.com/NUZMEHNvYD
— Dom (@DomsPlaying) May 3, 2018
Battle Royale already features in Call of Duty Online – a version of the game only available in China, and there are rumors that Battle Royale will feature in the upcoming Black Ops 4.
The potential also exists of course for Activision to create their own Battle Royale game, but with the strength of their existing IP’s, it is more likely it is tacked on to one of these recognized titles.