Sequels keep Activision growing

'Hero,' 'Duty' help vidgame co.'s revenues

No. 2 videogame publisher Activision had a very strong first three months of the year driven by “Guitar Hero II” and “Call of Duty 3,” helping it achieve its 15th straight year of revenue growth.

Santa Monica-based company, which is the second-biggest game publisher that doesn’t also make consoles (behind Electronic Arts), reported 66% revenue growth in the quarter to $313 million, well ahead of guidance. For the fiscal year ended March 31, revenue was up just 3% to $1.51 billion, reflecting a much slower first three quarters before the Wii and PlayStation 3 launched.

Like many other tech companies, Activision is still in the midst of an internal review over stock option backdating. As a result, its revenue figures are preliminary, and the company didn’t report net income or other financial stats. It expects to complete its review by the end of this month.

It did affirm, however, its revenue guidance for the current fiscal year, of $1.6 billion.

Smaller videogame publisher Midway, which is majority owned by Sumner Redstone, reported a much quieter quarter.

Company’s revenue was only $11.1 million, down 28% from a year earlier. Net loss was $19.8 million, down 12%.

Midway is expecting to have a much stronger current quarter, as “The Lord of the Rings Online,” which it co-published, has been garnering very strong reviews and pre-orders.

For the fiscal year ending in December, Midway expects to continue losing money. Guidance calls for a net loss of 44¢ per share on $225 million in revenue. That would be a significant improvement over last year, when it lost 86¢ per share on $165.6 million in revenue.

Shares in Activision closed up 1% at $20.97 after earnings were announced Thursday morning. Midway stock was flat at $7.04 before its earnings report.

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