Activision Q1 Preliminary Profit Above Outlook - Update

Mon. July 14, 2008; Posted: 08:05 PM

(RTTNews) - Activision Blizzard, Inc. (ATVID | Quote | Chart | News | PowerRating), formed by the combination of Vivendi Games and Activision, Monday said Activision's stand-alone preliminary financial results for the first quarter of fiscal year 2009, prior to the closing of the transaction with Vivendi, were higher than its previously provided first quarter outlook.

The Santa Monica, California-based pure-play online and console game publisher said that for the quarter ended June 30, Activision expects earnings on a standalone basis in the range of $0.16-$0.18 per share, compared to the previous outlook of $0.04 per share.

Excluding the expected impact of expenses related to equity-based compensation of $0.02 per share and expected one-time costs of $0.03 per share associated with the business combination between Activision and Vivendi Games, Activision's stand-alone non-GAAP earnings per share are expected to be between $0.21 per share and $0.23 per share.

The previous earnings expectation on a non-GAAP basis was $0.13 per share, which excluded $0.02 per share for expenses related to equity-based compensation and $0.07 per share one-time costs related to the business combination.

On average, 19 analysts polled by First Call/Thomson Financial expect first quarter earnings of $0.13 per share.

Net revenues for the quarter are expected to be about $650 million, above the previous expectation of $500 million. The Street expects revenues of $513.95 million.

According to the company, performance for the first quarter was driven by the North American launch of Kung Fu Panda early in the quarter. Late in the quarter, Activision had two record setting North American launches from the Guitar Hero franchise - Guitar Hero: On Tour and Guitar Hero: Aerosmith.

According to Robert Kotick, President and CEO of Activision Blizzard, "Activision's first quarter stand-alone net revenues and earnings were the highest ever for a non-holiday quarter."

On July 9, 2008, Activision Blizzard was created by a combination of Activision and Vivendi to make it the world's largest video-game publisher.

ATVID closed Monday's regular trade at $32.94, up 39 cents or 1.20% from the previous close, on 6.91 million shares. In the extended trade, the stock added $1.56 or 4.74% and was at $34.50.

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