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Activision Expects Record Third Quarter

Activision is unfortunately suffering through a backdating scandal, so they can't officially announce their complete third-quarter earnings for the its 2007 fiscal year. However, they can at least give us some preliminary findings.

For the quarter ending December 31, 2006, the company expects to see revenue totaling $822.8 million, which is a significant increase over its initial production of $600 million. Responsible for the likes of Tony Hawk Project 8, Guitar Hero II, and Marvel: Ultimate Alliance (some of the most popular titles of last year), Activision believes the quarter to be a record take, surpassing the $816.2 million mark for the same quarter in 2005.

On the other hand, those legal expenses are piling up. Due to the Securities and Exchanges Commission investigation into the company's "historical option grant practices," the ensuing cost is going to cut into the fourth quarter results. Ending on March 31, 2007, Activision is now only expecting net revenue of about $170 million.

As another negative impact on revenue, Activision says the delay of Quake Wars - the highly anticipated FPS from Splash Damage and id Software - will cause another problem. The official statement reads- "Fourth quarter results will be significantly impacted by higher legal expenses...and [the] decision to move the release of Enemy Territory: Quake Wars into fiscal year 2008" (which begins in April 2007).

We don't yet know the new release date for the game, but according to Activision, it won't be available until April at the earliest. But despite the obstacles, it's good news that the company's third quarter was so huge. After all, we can all use money...even if some of it has to be spent.

1/26/2007 Ben Dutka

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