Activision Blizzard Inc. reported earnings and revenue that missed analysts' estimates just weeks after Microsoft Corp. announced its $69 billion acquisition of the video game publisher. Adjusted revenue fell 18% to $2.49 billion in the fourth quarter, Activision Blizzard said in a statement Thursday. Analysts had expected $2.84 billion, according to an average of estimates compiled by Bloomberg. Adjusted earnings per share were $1.25, compared with analysts' forecasts for $1.31. The company cited "lower than expected performance" in its Activision division, which produces Call of Duty. Microsoft swooped in at a crucial time for Activision Blizzard, which is behind hit games such as Candy Crush and World of Warcraft.
Microsoft is buying Activision Blizzard Inc., a game development and interactive-entertainment content publisher, for $68.7 billion. Activision Blizzard makes games including Call of Duty, Candy Crush, Warcraft, Diablo, Overwatch, and Hearthstone. Microsoft will get Activision Blizzard's nearly 10,000 employees as part of the deal, which was announced on January 18. Microsoft officials are accelerating the growth in the company's gaming business across mobile, PC, console, and cloud, and say it "will provide building blocks for the metaverse." Microsoft also will get global eSports properties via Major League Gaming as part of the transaction. The $68.7 billion deal makes the Activision Blizzard acquisition the largest in Microsoft's history.
It was cute at first. When Xbox head Phil Spencer took the stage at E3 2018 and announced the acquisition of five notable studios – Undead Labs, Playground Games, Ninja Theory, Compulsion Games and The Initiative – the air inside the Microsoft Theater turned electric. It felt like the company was righting a wrong in its business plan and finally building an internal roster of exciting games that it could offer exclusively on Xbox platforms. You know, a few friends to keep Master Chief company. Today's announcement that Microsoft is buying Activision Blizzard, the largest third-party publisher in the video game industry, doesn't feel as harmless.
On Tuesday tech giant Microsoft announced its proposed purchase of gaming company Activision Blizzard for nearly $69 billion. The deal would grant Microsoft ownership over globally recognized franchises like Call of Duty, World of Warcraft, and Candy Crush, to name a few. It also creates a new division in the company, Microsoft Gaming, to be led by the company's head of its Xbox division, Phil Spencer. For Activision Blizzard, this couldn't have come at a better time. The company, run by CEO Bobby Kotick since 1991, has been the subject of scrutiny and lawsuits based on numerous allegations of discrimination, sexual harassment, and a toxic workplace culture at the company.
Microsoft has been on a gaming acquisition tear for the last few years, hoping to give the edge to its Xbox and Game Pass platforms as Sony's PlayStation continues to dominate with exclusive titles. The company previously purchased such notable companies as ZeniMax (AKA Bethesda), Minecraft developer Mojang, Id, Obsidian, Ninja Theory, Rare, Double Fine, and 343 Industries. But the computer giant's next purchase is so big it might shake the foundations of the gaming industry: Activision Blizzard. The news comes from as an official announcement from Microsoft itself, emblazoned with its prospective acquisition's biggest game series like World of Warcraft, Call of Duty, and Candy Crush. The acquisition is valued at $68.7 billion with Microsoft buying Activision Blizzard stock shares at $95 each. The deal is being given a full media blitz with a promotional page, press release, blog posts, open letters to employees, and even a map of the proposed management team.