Activision Blizzard Inc forecast second-quarter adjusted profit below estimates on Thursday, as the videogame maker puts more money into its franchises to battle competition from blockbuster games.
Activision, which continues its esports push, also revealed the first five franchises of its new city-based Call of Duty league, which follows its highly successful Overwatch league. The cities are Atlanta, Dallas, New York, Paris and Toronto.
However, Chief Financial Officer Dennis Durkin said on a post-earnings call the company does not expect to recognize material revenue and income from Call of Duty esports team sales and new mobile initiatives for Activision or Blizzard this year.
The company has labeled 2019 a “transition year”, cutting about 800 jobs and focusing on investing more in developing its game franchises “Call of Duty”, “Candy Crush”, “Overwatch”, “Warcraft”, “Hearthstone” and “Diablo”.
Activision said in February the number of developers working on its games will increase by about 20 percent over the course of 2019.
The company is set to release a new “Call of Duty” title in the second half of 2019, while its “Call of Duty” game for mobile phone users is slated for a worldwide launch.
The company earned 31 cents per share in the first quarter. The company reported total adjusted revenue of $1.26 billion for the quarter, boosted by demand for its “Candy Crush” and “Sekiro: Shadows Die Twice” games.
The company said its Sekiro videogame, launched in March, sold-through more than 2 million copies worldwide in less than 10 days.
It forecasts current-quarter adjusted revenue of $1.15 billion and profit of 23 cents per share.