Yahoo Finance The Key to Activision’s Digital Growth? More Monthly Active Users
Not All Bad after Activision Misses 4Q15 Estimates
Digital revenues rise 32% in 2015
In 2015, Activision’s (ATVI) GAAP digital revenues grew 32% year-over-year to $2.5 billion from $1.9 billion in 2014. Digital revenues accounted for 54% of total revenues in 2015, up from 43% in 2014.
In 4Q15, GAAP digital revenues grew 34.3% year-over-year to $724 million from $539 million in 4Q14. Digital revenues accounted for 54% of total revenues in 4Q15, up from 31% in 4Q14. Peer companies such as Electronic Arts (EA) and Take-Two Interactive (TTWO) have also reported a strong digital revenue growth in the last quarter, which has positively impacted profit margins as well.
Average monthly users grow 20% year-over-year
In 4Q15, average monthly active Activision (ATVI) users rose 20% year-over-year. Digital revenues grew 34%. Activision had approximately 80 million MAUs at the end of 4Q15. CEO Bobby Kotick stated that the acquisitions of King Digital and Major League Gaming were essential in increasing MAUs.
Activision Publishing’s Destiny has over 25 million registered users who have logged almost 3 billion hours of game time. Activision Publishing has four of the top ten games on next-generation consoles. Call of Duty: Black Ops III is at the number-one position.
Accessing the space through an ETF
Electronic Arts is 4.6% of the iShares North American Tech-Software ETF (IGV). The top holdings in this ETF include Adobe (ADBE), Microsoft (MSFT), and Salesforce (CRM), which account for 8.9%, 8.5%, and 8.3% of the fund.
Browse this series on Market Realist:
