Publisher Activision Blizzard on Wednesday announced increased revenues for the Xmas 2010 quarter, but revealed weaker than expected forecasts and plans to lay off 500 employees.
The publisher said it generated non-GAAP revenues of $2.55 billion for the quarter, compared to $2.50 billion in Q4 of last year. For the calendar year 2010, revenue reached $4.80 billion, up from $4.79 billion in 2009.
On an adjusted basis, profit for the quarter expressed in earnings per share was 53 cents a share, -- above analysts' average estimates of 51 cents a share, according to Reuters
As reported elsewhere
on Gamasutra, Activision Blizzard also announced it has disbanded the Guitar Hero
business unit, and has canceled its upcoming Guitar Hero
title for 2011. Activision also ceased development of the open-world title True Crime: Hong Kong
Despite ending development on its popular Guitar Hero
franchise, Activision Blizzard announced it was the number one publisher in North America and Europe in 2010.
In addition, the publisher's revenues from digital sales exceeded $470 million, up more than 40 percent from last year.
"Our revenues from digital channels, which now account for over 30 percent of our overall revenues, were driven by increased sales of Activision Publishing's Call of Duty
map packs and value-added services for Blizzard Entertainment's World of Warcraft
," said Activision CEO Bobby Kotick.
Kotick also noted that the most recent Call of Duty
map pack, released February 1, broke Xbox Live sales records with over 1.4 million downloads in just 24 hours.
For the calendar year 2011, Activision Blizzard said it hopes to see revenues of $3.9 billion; analysts had predicted revenues of $4.69 billion, reports CNBC
The company confirmed some new titles alongside its financial announcements, including a fresh iteration in the Spider-Man
franchise and new TV-licensed games including Family Guy
: In a SEC filing, Activision announced that it had "approved a restructuring plan involving a focus on the development and publication of a reduced slate of titles on a going-forward basis, including the discontinuation of the development of all music-based games and the closure of the related business unit and the cancellation of other titles then in production, and a related reduction in studio headcount and corporate overhead."
Due to a refocusing and "anticipation of a continuing weak environment for casual and music-based games", the plan will result in the layoff of approximately 500 employees, resulting in "a net pre-tax charge in the first two quarters of 2011, which is expected to total between $35 and $50 million, comprised of severance costs, the costs of other separation benefits and other exit costs."]