We got the 2020 Q2 financial results for Activision Blizzard yesterday, and it confirmed that the video game market is still doing pretty well.
Overall the combined company had a very good Q3 2020, well up over last year, though much of the good news came from the Activision side of the house, where they were still riding the Q2 Call of Duty launch for all it was worth. The company is even talking about hiring 2,000 more people to keep up with demand. That is a long way from the 2018 results when they were cutting staff.
The Activision team was up almost 3x over their Q3 2019 net revenue.
Blizzard, while up, was only up a small amount over Q3 2020. However, Q3 2020 was the start of the Blizzard revival where, after two quarters in the doldrums, WoW Classic launched and revived their fortunes.
Meanwhile, Q3 2020 was in something of limbo state as the Shadowlands expansion was slated for a Q4 launch. There was little new to entice people players back. There wasn’t even the expansion pre-patch to raise some excitement.
But the slide deck rightly looks for Q4 2020 to be a big deal.
Blizzard got the Shadowlands pre-patch out earlier this month, unveiling the big level squish for all to see and experience. And now we have a date for the start of the expansion pre-launch events, November 10th, and the launch of the expansion itself, November 23rd. Blizzard will be able to recognize revenue on all those pre-orders the day it launches. The is usually a pretty big ka-ching moment.
However, outside of World of Warcraft there isn’t a lot of big news. Hearthstone carries on, with a new expansion on the way.
Overwatch remains popular, though a year after the Overwatch 2 announcement it doesn’t feel like much has changed. I flagged Overwatch 2 as one of the “big four” announcements at BlizzCon 2019, but I don’t pay enough attention to the game to know what has gone on since then, except for the fact I haven’t seen any headlines about it lately.
Diablo IV remains somewhere in the distant future. I think I said 2022 last year when it was finally announced, and I might have been optimistic with that call.
And then there is Diablo Immortal, perpetually in some new stage of testing, but never quite ready to launch. It can’t fail it they never release it I guess.
So Q4 is almost guaranteed to be big for Blizz, but unless Shadowlands gets more traction than Battle for Azeroth did, there isn’t a lot else to depend on after that. For all the other franchises, it is still WoW that carries the load.
You can, as always, find all the numbers over at the Activision Blizzard investor relations page.