Activision Blizzard, Inc. (NASDAQ: ATVI) had a forgettable February, as its games didn’t take off — but this didn’t show in its stock, which has been on a run up since November.
Activision’s digital games fared ordinarily compared to competitors, including Electronic Arts Inc (NASDAQ: EA) and Ubisoft, according to data released by SuperData Research, which provides games and interactive media intelligence. The lukewarm showing by Activision came despite the fairly solid growth recorded by the digital games market worldwide.
A Growing Sector
The worldwide digital games market grew 4 percent year-over-year to $7.83 billion in February, underlined by 9 percent growth in the mobile segment and 8 percent growth in console segment, according to SuperData Research. The growth in the mobile and console segment was offset by shrinking pay-to-play, free-to-play and social segments, the company said. February’s performance pales before the 9.8 percent growth recorded in January, as strong downloads to consoles and PCs after the holiday season buoyed the market.
U.S. Outpaces Global Growth
The SuperData also showed that U.S. digital revenues rose 6.4 percent in February, with console revenues surging by 18 percent due to an increase in the average selling price of digital units.
Mobile revenues rose slightly, a slowdown from the double-digit growth pace seen in January. “As indicated yet again by GameStop Corp. (NYSE: GME)’s recent earnings, the shift to digital and the longer time players are staying with existing titles thanks to DLC releases is having a massive impact on the retailer’s ability to stay relevant when it comes to games,” the SuperData report said.
Here are the details divulged on individual games by the report:
- Activision’s Hearthstone digital revenues fell to a new low since releasing on both Android and iOS platforms. Mobile conversion fell steeply due to recent, unpopular gameplay decisions with the Hearthstone community.
- Electronic Arts was the winner all the way in February, as its FIFA 17 digital revenue grew in double-digits versus FIFA 16’s performance last year. The company was helped by a 15 percent jump in monthly active users and increases in both conversion and average revenue per paying user, or ARPPU. Ultimate Team console revenue also saw double-digit growth.
- Electronic Arts’ Battlefield 1 once again left its other first-person shooter, or FPS, peers behind, selling more digital units across console and PC than Activision’s “Call of Duty: Infinite Warfare” and its own “Titanfall 2” combined. That said, the report showed that “Infinite Warfare” fetched the most additional content revenue on the back of its Downloadable Content, or DLC, release.
- Ubisoft’s For Honor, despite being launched worldwide after the busy holiday season, on February 14, sold over 700,000 digital units across console and PC, lifting it to the No. 7 position in the top 10 console rankings.
Source: SuperData Research
Stock Performance: Activision On Top
Despite the February setback, Activision’s shares outperformed Electronic Arts,’ gaining 56 percent over the last year compared to gains of roughly 39 percent for the latter.
ATVI Source: Y Charts
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