In our little corner of the internet it is broadly assumed that 2021 has been a very bad year for Blizzard, perhaps their worst year ever. How can it not be? Look at the scandals! Look at the headlines! Look at the stock price! Look at the employees leaving… pushed or otherwise! Look at all those influencers jumping ship for FFXIV or whatever!
But, as I have to remind myself from time to time, our little corner of the internet is kind of a weirdo fringe of video game consumers overall. We are the connoisseurs in our little internet box when it comes to MMORPGs and the companies that make them. So, for many of us, the scandal at Blizzard, the tales of abuse and institutionally condoned harassment, must be what is hurting the company. We want to believe that when people do bad things that they eventually pay a price.
Alas, even a headline in the Wall Street Journal doesn’t seem to have done much to Blizzard.
In fact, so far there isn’t much direct evidence that the scandal has hurt the company at all. Sure, Blizzard hasn’t seen a quarter as big as Q4 2020 in all of 2021, but that was a WoW expansion launch quarter, which traditionally stands out as a high point. Shadowlands, whatever you think about it now, sold well a year ago, recognizing revenue on 3.7 million copies on launch day.
So Q1 2021 carried over from that launch, logging $483 million in revenue. Then there is Q2 2021, which saw a dip in revenue, down to $433 million. But the scandal only broke in June, so it is hard to believe that it was a bigger hit that dissatisfaction with Shadowlands at that point.
And then there was Q3 2021, when revenue went up to $493 million. The numbers were buoyed by the launch of Diablo II Resurrected, but the scandal was headline news with weekly revelations in Q3. The argument that D2R sold well in South Korea and they don’t care about the scandal doesn’t hold a lot of water. South Korea didn’t buy that many copies of the game, not enough to offset the rest of the world walking away because bad people run Blizzard.
Even the stock price, which jumped up past 100 early in the, could have fallen down to the mid-50s based on the game pipeline as much as anything else. And the stock has started to creep up from its low at the start of the month.
So while the righteous outrage at the behavior of the company and the people is totally justified, I have the impression that it is just us weirdos in the box that are doing anything about it, unsubscribing or whatever. The reason Blizzard is off its game is because it cannot ship anything new, and the one new thing they shipped in the last year, the Shadowlands expansion, has fallen flat. People unaware of the company’s troubles will leave if they are not having fun.
The Blizzard 2021 catalog has mostly been retreads… Burning Crusade Classic, WoW Classic Season of Mastery, and Diablo II Resurrected… along with the usual new Hearthstone variations and expansions. And unless things change this quarter, Blizzard is still going to be a billion dollar division in the greater Activision corporate structure.
Now, the reasons they cannot seem to ship a new title may very well be tied up in the problems with how the company is being run, and we have a ways to go to see how Q4 2021 will fare. Q4 is traditionally a strong quarter for video games… if you ship something new. If Q4 tanks for Blizzard’s share of the revenue pie, maybe it will be a sign that something else is in play.
So far as 2022 goes, there isn’t much on the agenda aside from Diablo Immortal finally seeing the light of day. There ought to be a new WoW expansion on the horizon. We’ll see if their internal struggles allow that to move forward in time.