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Activision Blizzard Earnings Better Than Expected for Q1

Powered by record revenues from digital channels of more than half a billion dollars, gamemaker Activision Blizzard posted better-than-expected earnings in the first quarter and increased its projections for all of 2015.

The maker of “Call of Duty,” “World of Warcraft” and other games announced that more than three quarters of its revenue ($538 million) came from digital channels, rather than retail product sales or other sources. The company now projects a slight increase in net revenues from $4.4 billion to $4.425 billion for 2015. It pegged earnings per share for the year at $1.20, up from the previously projected $1.15.

Activision Blizzard claimed more than 150 million active users worldwide over the past year who spent 12 billion hours playing the company’s games, said chief executive Bobby Kotick. Enduring titles continue to show strength for the company. The “Call of Duty” franchise, for example, experienced double-digit percentage growth compared to the prior year. A free beta version of the game in China continued to build revenue via sales of virtual items like customized vehicles, weapons and armor.

The Santa Monica-based company recently announced it would bring back one of its favorites of the past, unveiling a “Guitar Hero Live” that will be available on consoles, tablets and mobile phones this fall.

Even in cases where its audience declined, the company managed revenue advances because of increased pricing and time of engagement per user. Subscribers for “World of Warcraft” declined to 7.1 million from 10 million, for example, but regional price increases and the purchase of more value-added items partially covered the decline.

Kotick ascribed the company’s success to talent acquisition and retention. He noted that Activision Blizzard had been recognized as one of the “100 Best Companies to Work For” by Fortune magazine. “Our biggest accomplishment remains our ability to attract and retain so many talented, capable, driven and hard-working people with an unyielding commitment to excellence,” Kotick said.

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