For the first quarter of 2023 ending 3/31/23, Activision Blizzard (NASDAQ: ATVI) reported revenue increased 35% over the previous year to $2.38 billion. Net bookings were up 25% to $1.86 billion. Net income for the quarter was $740 million compared with $395 million for the first quarter of 2022.
In its financial release Activision commented on the U.K. CMA decision to block its acquisition by Microsoft. The company stated:
Activision Blizzard considers that the CMA’s decision is disproportionate, irrational and inconsistent with the evidence. Microsoft has announced its decision to appeal the CMA’s ruling, and Activision Blizzard intends to fully support Microsoft’s efforts on this appeal.
Analysis
Of course, the big news is the U.K. Competition and Markets Authority (CMA) decision to block Microsoft’s acquisition of Activision Blizzard. That topic is dealt with separately. Meanwhile focusing on the financials shows that Activision appears stronger than it has for years.
Revenue growth was across all categories with the largest growth in PC games which soared 74% YOY in Q1 to $666 million. This was an all-time record for Activision PC games in any quarter, except for the holiday 2016 and 2017 quarters when Overwatch was at its peak. Mobile game revenue of $956 million was also the largest of any quarter since ATVI acquired King.
Overall, the financial results are one of the best signs yet indicating 2023 will be a strong year for the video game industry. DFC Intelligence expects the upcoming Diablo IV launch (June 6) to be a big driver for ATVI’s second quarter. Initial impressions are very positive.
DFC is now taking a serious look at what an independent Activision Blizzard will mean for investors. Reaching the $69 billion market value Microsoft was offering may be a stretch. However, it may not be as much of a stretch as some are assuming. Stay tuned!
