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Activision Announces Record First Quarter 2008 Results

- First Quarter Net Revenues Increase 163% and EPS Hits All Time Q1 High - - Company Increases Fiscal 2008 Net Revenue and EPS Outlook - - Company Expects To Deliver Record Fiscal Year Operating Margin -

SANTA MONICA, Calif., Aug 02, 2007 (BUSINESS WIRE) --

Activision, Inc. (Nasdaq:ATVI) today announced record financial results for the first fiscal quarter ended June 30, 2007.

Net revenues were $495.5 million, a 163% increase, as compared to net revenues of $188.1 million reported for the first quarter last fiscal year. Net income for the first fiscal quarter was $27.8 million, or $0.09 earnings per diluted share, as compared to a net loss of $18.3 million, or a loss per share of $0.07 reported for the previous first quarter. Excluding the impact of expenses related to equity-based compensation, the company reported net income of $32.8 million and earnings per diluted share of $0.11 for the first quarter. This compares to a net loss of $14.7 million and loss per share of $0.05, excluding the impact of expenses related to equity-based compensation for the first quarter of last fiscal year.

Robert Kotick, Chairman and CEO of Activision, stated, "During the quarter, we shipped more than eight million units of new game releases worldwide and for the first six months of the calendar year, Activision was the #1 third-party U.S. publisher on the console and handheld platforms. As a result of our strong performance, we are raising our fiscal year 2008 net revenue and earnings outlook and are increasing our fiscal year operating margin outlook to a company record"

Kotick continued, "Our focus on growing our strong franchises and next- generation console leadership position is yielding superb results. We intend to continue expanding our franchise portfolio, strengthening our development capabilities and improving our operating efficiency over the balance of the fiscal year. We believe this strategy will create strengths and capabilities that should enable us to continue growing our revenues, operating margin and earnings per share, as well as increase our return on invested capital."

Business Highlights

Activision's record first quarter performance was driven by strong consumer response to its proven franchises, Guitar Hero II(TM), Spider-Man 3(TM) and Shrek The Third(TM), as well as its new intellectual property TRANSFORMERS: The Game, which was released in the U.S. during the quarter.

According to The NPD Group, during the quarter, Activision was the #1 U.S. publisher on both the Xbox 360(TM) video game and entertainment system and the PlayStation(R) 2 computer entertainment system. The company also ranked as the #1 third-party publisher on the PLAYSTATION(R) 3 computer entertainment system and the Nintendo platforms in the U.S. Activision grew its U.S. console and hand-held market share to 16.9%, as compared with 8.5% over the same period last year.

Other quarterly business highlights are as follows:

-- Guitar Hero II and Spider-Man 3 were two of the top-three best-selling titles for the quarter in the U.S., according to The NPD Group. Guitar Hero II was the #1 best-selling U.S. console game overall, and Spider-Man 3 was the #3 best-selling U.S. console and handheld game.

-- Shrek The Third was the #1 kid's movie-based title in the U.S. for the months of May and June combined, according to The NPD Group.

-- In the U.S., Activision was the #1 third-party handheld publisher, according to The NPD Group.

-- Activision's international publishing revenues grew 240% year over year.

-- In Europe, Spider-Man 3 was the #1 best-selling console and handheld game for the quarter in the U.K., Germany and France, according to Charttrack and Gfk.

-- On May 11, 2007, Activision completed its acquisition of DemonWare, the leading provider of network middleware technologies for console and PC games headquartered in Dublin, Ireland.

For the second quarter, Activision has already shipped TRANSFORMERS: The Game internationally in connection with the film's theatrical release and Guitar Hero(TM) Encore: Rocks The 80s(TM) for the PlayStation 2 computer entertainment system. Activision also expects to ship Enemy Territory(TM): Quake Wars on the PC.

Company Outlook

Today, Activision increased its fiscal year 2008 net revenue and earnings per share outlook. For the full fiscal year, the company expects net revenues of $1.87 billion and earnings per diluted share of $0.51, including the impact of equity-based compensation expense, compared to the company's previous fiscal year outlook of $1.8 billion in net revenues and earnings per diluted share of $0.45. Excluding the impact of equity-based compensation expense, the company expects earnings per diluted share of $0.61.

For the second quarter, the company expects net revenues of $250 million and a loss per share of $0.04, including the impact of equity-based compensation expense. Excluding the impact of equity-based compensation expense, the company expects a loss per share of $0.03.

Conference Call

Today at 4:30 p.m. EDT, Activision's management will host a conference call and Webcast to discuss its first quarter fiscal year 2008 results and outlook. The company welcomes all members of the financial and media communities to visit the "Investor Relations" area of www.activision.com to listen to the conference call via live Webcast or to listen to the call live by dialing into (719) 457-2699 in the U.S.

Non-GAAP Financial Measures

Activision provides net earnings (loss) per share data both including and excluding the impact of expenses related to stock options, employee stock purchase plans, restricted stock awards and other share-based compensation and the associated tax benefits.

Prior to April 1, 2006, Activision accounted for equity-based compensation under Accounting Principles Board, Opinion No. 25, "Accounting for Stock Issued to Employees" ("APB No. 25"). In accordance with APB No. 25 the company historically used the intrinsic value method to account for equity-based compensation. As of April 1, 2006, the company accounts for equity-based compensation using the fair value method under Statement of Financial Accounting Standards No. 123 (revised 2004), "Share Based Payment" ("FAS 123R").

Net earnings (loss) per share excluding the impact of expenses related to equity-based compensation is not determined in accordance with generally accepted accounting principles (GAAP), and the exclusion of those amounts has the effect of increasing non-GAAP earnings per share by that same amount per share as compared to GAAP earnings per share for the period. Activision recognizes that there are limitations associated with the use of this non-GAAP financial measure as it does not reflect all of the expenses associated with our results as determined in accordance with GAAP and may reduce comparability to other companies that calculate similar non-GAAP measures differently. Management compensates for the limitations resulting from the exclusion of expenses related to stock-based compensation by considering the amount and impact of equity-based compensation expenses separately and by considering the company's GAAP as well as non-GAAP results and, in this release, by presenting the most comparable GAAP measure, net income (loss), directly ahead of non-GAAP net income (loss) in this release and by providing a reconciliation that shows and describes the adjustments made in the accompanying tables. Management does not believe the limitations resulting from this exclusion are material, particularly when this non-GAAP financial measure is disclosed with its most comparable GAAP financial measure, net income (loss). Management believes that the presentation of this non-GAAP financial measure provides investors with additional useful information to measure the company's financial performance because it allows for a better comparison of results in the periods reported herein to those in historical periods.

This non-GAAP financial measure should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with GAAP. Non-GAAP net earnings (loss) do not include certain expenses required to be recorded in order to present earnings in accordance with GAAP. This non-GAAP financial measure is not based on a comprehensive set of accounting rules or principles and the term non-GAAP net earnings (loss) does not have a standardized meaning. Therefore, other companies may use the same or similarly named measure but exclude different items, which may not provide investors a comparable view of the company's performance in relation to other companies in the same industry.

About Activision

Headquartered in Santa Monica, California, Activision, Inc. is a leading worldwide developer, publisher and distributor of interactive entertainment and leisure products. Founded in 1979, Activision posted net revenues of $1.5 billion for the fiscal year ended March 31, 2007.

Activision maintains operations in the U.S., Canada, the United Kingdom, France, Germany, Ireland, Italy, Scandinavia, Spain, the Netherlands, Australia, Japan and South Korea. More information about Activision and its products can be found on the company's World Wide Web site, which is located at www.activision.com.

Cautionary Note Regarding Forward-looking Statements: Information in this press release that involves Activision's expectations, plans, intentions or strategies regarding the future are forward-looking statements that are not facts and involve a number of risks and uncertainties. In this release they are identified by references to dates after the date of this release and words such as "outlook", "will," "will be," "remains," "to be," "plans," "believes", "may", "expects," "intends," and similar expressions. Factors that could cause Activision's actual future results to differ materially from those expressed in the forward-looking statements set forth in this release include, but are not limited to, sales of Activision's titles, shifts in consumer spending trends, the seasonal and cyclical nature of the interactive game market, Activision's ability to predict consumer preferences among competing hardware platforms (including next-generation hardware), declines in software pricing, product returns and price protection, product delays, retail acceptance of Activision's products, adoption rate and availability of new hardware and related software, industry competition, rapid changes in technology and industry standards, protection of proprietary rights, maintenance of relationships with key personnel, customers, vendors and third-party developers, international economic and political conditions, integration of recently acquired subsidiaries and identification of suitable future acquisition opportunities, limitations on our ability to issue stock and options, foreign exchange rate changes.

Other factors include the further implementation, acceptance and effectiveness of the remedial measures recommended or adopted by the special sub-committee of independent directors established in July 2006 to review our historical stock option granting practices, the board and Activision; the outcome of the SEC's formal investigation and the derivative litigation filed in July 2006 against certain current and former directors and officers of Activision relating to Activision's stock option granting practices, and the possibility that additional claims and proceedings will be commenced, including additional stockholder litigation, employee litigation, and additional action by the SEC and/or other regulatory agencies, other litigation (unrelated to stock option granting practices) and the additional risks identified in Activision's most recent annual report on Form 10-K and periodic reports on Form 10-Q. The forward-looking statements in this release are based upon information available to Activision as of the date of this release, and Activision assumes no obligations to update any such forward-looking statement. Forward-looking statements believed to be true when made may ultimately prove to be incorrect. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and may cause actual results to differ materially from our current expectations.

ACTIVISION, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except earnings per share data)

----------------------------- -------- --------- ---------- ----------
                                Quarter ended         Year ended
                                   June 30,            March 31,
----------------------------- ------------------ ---------------------
                                2007     2006       2007       2006
----------------------------- -------- --------- ---------- ----------

Net revenues                  $495,455 $188,069  $1,513,012 $1,468,000
Costs and expenses:
 Cost of sales - product
  costs                        217,229  108,623     799,587    734,874
 Cost of sales - software
  royalties and amortization    78,252   19,261     132,353    147,822
 Cost of sales - intellectual
  property licenses             32,479    9,916      46,125     57,666
 Product development            32,897   25,625     133,073    132,651
 Sales and marketing            68,712   36,179     196,213    283,395
 General and administrative     35,794   21,914     132,514     96,366
----------------------------- -------- --------- ---------- ----------
      Total operating
       expenses                465,363  221,518   1,439,865  1,452,774
----------------------------- -------- --------- ---------- ----------
Operating income (loss)         30,092  (33,449)     73,147     15,226
Investment income, net          11,562    8,275      36,678     30,630
----------------------------- -------- --------- ---------- ----------
Income (loss) before income
 tax provision                  41,654  (25,174)    109,825     45,856
Income tax provision
 (benefit)                      13,828   (6,865)     24,038      5,605
----------------------------- -------- --------- ---------- ----------
Net income (loss)             $ 27,826 $(18,309) $   85,787 $   40,251
============================= ======== ========= ========== ==========


----------------------------- -------- --------- ---------- ----------
Basic earnings (loss) per
 share                        $   0.10 $  (0.07) $     0.31 $     0.15
Weighted average common
 shares outstanding            283,563  278,335     281,114    273,177
----------------------------- -------- --------- ---------- ----------


----------------------------- -------- --------- ---------- ----------
Diluted earnings (loss) per
 share                        $   0.09 $  (0.07) $     0.28 $     0.14
Weighted average common
 shares outstanding assuming
 dilution                      311,993  278,335     305,339    294,002
----------------------------- -------- --------- ---------- ----------

ACTIVISION, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
----------------------------------------------------------------------
                                                  June 30,  March 31,
                                                    2007       2007
----------------------------------------------------------- ----------
ASSETS
----------------------------------------------------------- ----------
 Current assets:
  Cash, cash equivalents and short-term
   investments                                   $  963,796 $  954,849
  Accounts receivable, net                          197,964    148,694
  Inventories                                        92,529     91,231
  Software development                              104,944    107,779
  Intellectual property licenses                     13,143     27,784
  Deferred income taxes                              50,197     51,564
  Other current assets                               20,507     19,332
----------------------------------------------------------- ----------
       Total current assets                       1,443,080  1,401,233
----------------------------------------------------------- ----------
 Software development                                 9,180     23,143
 Intellectual property licenses                      68,645     72,490
 Property and equipment, net                         48,706     46,540
 Deferred income taxes                               41,933     48,791
 Other assets                                         6,473      6,376
 Goodwill                                           221,049    195,374
----------------------------------------------------------- ----------
                  Total assets                   $1,839,066 $1,793,947
=========================================================== ==========

----------------------------------------------------------- ----------
LIABILITIES AND SHAREHOLDERS' EQUITY
----------------------------------------------------------- ----------
 Current liabilities:
  Accounts payable                               $  109,662 $  136,517
  Accrued expenses and other liabilities            249,940    204,652
----------------------------------------------------------- ----------
        Total current liabilities                   359,602    341,169
----------------------------------------------------------- ----------
  Other liabilities                                  17,971     41,246
----------------------------------------------------------- ----------

                Total liabilities                   377,573    382,415
----------------------------------------------------------- ----------
 Shareholders' equity:
  Common stock                                            -          -
  Additional paid-in capital                        983,373    963,553
  Retained earnings                                 455,603    427,777
  Accumulated other comprehensive income             22,517     20,202
----------------------------------------------------------- ----------
        Total shareholders' equity                1,461,493  1,411,532
----------------------------------------------------------- ----------
            Total liabilities and shareholders'
             equity                              $1,839,066 $1,793,947
=========================================================== ==========

ACTIVISION, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except earnings per share data)

-------------------------------------- -------------------- ----------
Quarter ended    Cost of
 June 30, 2007   Sales -
                 Software
                 Royalties                        General
                   and                              and       Total
                  Amorti-   Product    Sales and  Administ-  Operating
                  zation   Development  Marketing  rative    Expenses
-------------------------------------- -------------------- ----------
GAAP
 Measurement    $ 78,252  $ 32,897     $ 68,712  $ 35,794   $  465,363
 Less: Equity-
  Based
  Compensation
  Adjustment(1)    1,845     1,507        1,771     3,037        8,160
                ---------------------- -------------------- ----------
Non-GAAP
 Measurement    $ 76,407  $ 31,390     $ 66,941  $ 32,757   $  457,203
----------------====================== ==================== ==========

-------------------------------------- -------------------- ----------


-------------------------------------- -------------------- ----------
Quarter ended                            Basic
 June 30, 2007  Operating               Earnings
                  Income  Net Income     (Loss)    Diluted Earnings
                  (Loss)     (Loss)     per Share   (Loss) per Share
-------------------------------------- -------------------------------
GAAP
 Measurement    $ 30,092  $ 27,826     $   0.10  $   0.09
 Less: Equity-
  Based
  Compensation
  Adjustment(1)   (8,160)   (4,969)       (0.02)    (0.02)
                ---------------------- -------------------- ----------
Non-GAAP
 Measurement    $ 38,252  $ 32,795     $   0.12  $   0.11
----------------====================== ==================== ==========

-------------------------------------- -------------------- ----------

-------------------------------------- -------------------- ----------
Year ended June  Cost of
 30, 2007        Sales -
                 Software
                 Royalties                        General
                   and                              and       Total
                  Amorti-   Product    Sales and  Administ-  Operating
                  zation   Development  Marketing  rative    Expenses
-------------------------------------- -------------------- ----------
GAAP
 Measurement    $132,353  $133,073     $196,213  $132,514   $1,439,865
 Less: Equity-
  Based
  Compensation
  Adjustment(1)    2,503     5,728        5,267    12,024       25,522
                ---------------------- -------------------- ----------
Non-GAAP
 Measurement    $129,850  $127,345     $190,946  $120,490   $1,414,343
----------------====================== ==================== ==========

-------------------------------------- -------------------- ----------


-------------------------------------- -------------------- ----------
Year ended June                          Basic
 30, 2007       Operating               Earnings
                  Income  Net Income     (Loss)    Diluted Earnings
                  (Loss)     (Loss)     per Share   (Loss) per Share
-------------------------------------- -------------------------------
GAAP
 Measurement    $ 73,147  $ 85,787     $   0.31  $   0.28
 Less: Equity-
  Based
  Compensation
  Adjustment(1)  (25,522)  (15,543)       (0.06)    (0.05)
                ---------------------- -------------------- ----------
Non-GAAP
 Measurement    $ 98,669  $101,330     $   0.36  $   0.33
----------------====================== ==================== ==========

(1)Includes expense related to employee stock options, employee stock
 purchase plan and restricted stock under Statement of Financial
 Accounting Standards No. 123 (revised 2004), "Share Based Payment."
 See explanation above regarding the Company's practice on reporting
 non-GAAP financial measures. The per share equity-based compensation
 adjustment is presented as calculated, and the GAAP and Non-GAAP
 Earnings (Loss) per Share information is also presented as
 calculated. The sum of these measures, as presented, may differ due
 to the impact of rounding.

The quarterly and annual fiscal 2006 and first quarter fiscal 2007
 statements of operations and balance sheets reflect the correction of
 errors in the determination of the measurement date as defined in
 Accounting Principles Board Opinion No. 25, "Accounting for Stock
 Issued to Employees", with respect to certain employee options
 granted and modified in our fiscal years between 1992 and 2006. These
 errors were identified by a special subcommittee of independent
 members of the company's Board of Directors. The findings of the
 special sub-committee's review were announced on March 8, 2007. As a
 result, we restated previously issued consolidated financial
 statements included in our recently filed Annual Report on Form 10-
 K/A for the fiscal year ended March 31, 2006, and we expect to file
 shortly restated previously issued consolidated financial statements
 for the first quarter of fiscal 2007 on Form 10-Q/A.

Additionally, the statement of operations and balance sheets for the
 second and third quarters of fiscal 2007 presented in this earnings
 release have been updated from previously announced preliminary
 financial results, and reflect subsequent event adjustments primarily
 related to a change in the company's effective tax rate, changes in
 expense accrual estimates and adjustments to equity-based
 compensation expense.

Throughout this press release, all referenced amounts for prior
 periods and prior period comparisons reflect the balances and amounts
 on a restated basis.

ACTIVISION, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except earnings per share data)

----------------------------------------------------------------------
Quarter ended      Cost of
 June 30, 2006     Sales -
                   Software
                   Royalties                       General
                     and                             and      Total
                    Amorti-   Product   Sales and  Administ- Operating
                    zation   Development Marketing  rative   Expenses
----------------------------------------------------------------------
GAAP Measurement   $ 19,261    $ 25,625  $ 36,179   $21,914 $  221,518
 Less: Equity-
  Based
  Compensation
  Adjustment(2)          36       1,679     1,040     3,094      5,849
                  ----------------------------------------------------
Non-GAAP
 Measurement       $ 19,225    $ 23,946  $ 35,139   $18,820 $  215,669
------------------====================================================

----------------------------------------------------------------------


----------------------------------------------------------------------
Quarter ended                             Basic
 June 30, 2006    Operating              Earnings
                    Income  Net Income    (Loss)   Diluted Earnings
                    (Loss)     (Loss)    per Share  (Loss) per Share
----------------------------------------------------------------------
GAAP Measurement   $(33,449)   $(18,309) $  (0.07)  $ (0.07)
 Less: Equity-
  Based
  Compensation
  Adjustment(2)      (5,849)     (3,562)    (0.01)    (0.01)
                  ----------------------------------------------------
Non-GAAP
 Measurement       $(27,600)   $(14,747) $  (0.05)  $ (0.05)
------------------====================================================

----------------------------------------------------------------------

----------------------------------------------------------------------
Year ended June    Cost of
 30, 2006          Sales -
                   Software
                   Royalties                       General
                     and                             and      Total
                    Amorti-   Product   Sales and  Administ- Operating
                    zation   Development Marketing  rative   Expenses
----------------------------------------------------------------------
GAAP Measurement   $147,822    $132,651  $283,395   $96,366 $1,452,774
 Less: Equity-
  Based
  Compensation
  Adjustment(2)           -         869       175     2,057      3,101
                  ----------------------------------------------------
Non-GAAP
 Measurement       $147,822    $131,782  $283,220   $94,309 $1,449,673
------------------====================================================

----------------------------------------------------------------------


----------------------------------------------------------------------
Year ended June                           Basic
 30, 2006         Operating              Earnings
                    Income  Net Income    (Loss)   Diluted Earnings
                    (Loss)     (Loss)    per Share  (Loss) per Share
----------------------------------------------------------------------
GAAP Measurement   $ 15,226    $ 40,251  $   0.15   $  0.14
 Less: Equity-
  Based
  Compensation
  Adjustment(2)      (3,101)     (1,895)    (0.01)    (0.01)
                  ----------------------------------------------------
Non-GAAP
 Measurement       $ 18,327    $ 42,146  $   0.15   $  0.14
------------------====================================================

(2)Includes expense related to employee stock options, employee stock
 purchase plan and restricted stock under Statement of Financial
 Accounting Standards No. 123 (revised 2004), "Share Based Payment."
 See explanation above regarding the Company's practice on reporting
 non-GAAP financial measures. The per share equity-based compensation
 adjustment is presented as calculated, and the GAAP and Non-GAAP
 Earnings (Loss) per Share information is also presented as
 calculated. The sum of these measures, as presented, may differ due
 to the impact of rounding.

The quarterly and annual fiscal 2006 and first quarter fiscal 2007
 statements of operations and balance sheets reflect the correction of
 errors in the determination of the measurement date as defined in
 Accounting Principles Board Opinion No. 25, "Accounting for Stock
 Issued to Employees", with respect to certain employee options
 granted and modified in our fiscal years between 1992 and 2006. These
 errors were identified by a special subcommittee of independent
 members of the company's Board of Directors. The findings of the
 special sub-committee's review were announced on March 8, 2007. As a
 result, we restated previously issued consolidated financial
 statements included in our recently filed Annual Report on Form 10-
 K/A for the fiscal year ended March 31, 2006, and we expect to file
 shortly restated previously issued consolidated financial statements
 for the first quarter of fiscal 2007 on Form 10-Q/A.

Additionally, the statement of operations and balance sheets for the
 second and third quarters of fiscal 2007 presented in this earnings
 release have been updated from previously announced preliminary
 financial results, and reflect subsequent event adjustments primarily
 related to a change in the company's effective tax rate, changes in
 expense accrual estimates and adjustments to equity-based
 compensation expense.

Throughout this press release, all referenced amounts for prior
 periods and prior period comparisons reflect the balances and amounts
 on a restated basis.

ACTIVISION, INC. AND SUBSIDIARIES
FINANCIAL INFORMATION
For the Quarter Ended June 30, 2007
(Amounts in thousands)

                                                             Percent
                                                             Increase
                                     Quarter Ended          (Decrease)
                           -------------------------------------------
                            June 30, 2007    June 30, 2006
                             Amount  % of     Amount  % of
                                      Total            Total
-------------------------- -------------------------------------------
Geographic Revenue Mix
 North America             $  309,536   62% $   99,610   53%      211%
 International                185,919   38%     88,459   47%      110%
-------------------------- -------------------------------------------
 Total net revenues        $  495,455  100% $  188,069  100%      163%
-------------------------- -------------------------------------------


-------------------------- -------------------------------------------
Segment/Platform Mix
Publishing:
 Console                   $  358,773   72% $   90,189   48%      298%
 Hand-held                     56,616   12%     26,584   14%      113%
 PC                            13,833    3%     17,989   10%      -23%
-------------------------- -------------------------------------------
 Total publishing net
  revenues                 $  429,222   87% $  134,762   72%      219%
-------------------------- -------------------------------------------

Distribution:
 Console                   $   43,101    8% $   28,788   15%       50%
 Hand-held                     19,116    4%     18,213   10%        5%
 PC                             4,016    1%      6,306    3%      -36%
-------------------------- -------------------------------------------
 Total distribution net
  revenues                 $   66,233   13% $   53,307   28%       24%
----------------------------------------------------------------------
 Total net revenues        $  495,455  100% $  188,069  100%      163%
-------------------------- -------------------------------------------

                                                             Percent
                                                             Increase
                                      Year Ended            (Decrease)
                           -------------------------------------------
                            June 30, 2007    June 30, 2006
                             Amount  % of     Amount  % of
                                      Total            Total
-------------------------- -------------------------------------------
Geographic Revenue Mix
 North America             $  753,376   50% $  710,040   48%        6%
 International                759,636   50%    757,960   52%        0%
-------------------------- -------------------------------------------
 Total net revenues        $1,513,012  100% $1,468,000  100%        3%
-------------------------- -------------------------------------------


-------------------------- -------------------------------------------
Segment/Platform Mix
Publishing:
 Console                   $  886,795   59% $  812,345   55%        9%
 Hand-held                    153,357   10%    158,861   11%       -3%
 PC                            78,886    5%    183,457   13%      -57%
-------------------------- -------------------------------------------
 Total publishing net
  revenues                 $1,119,038   74% $1,154,663   79%       -3%
-------------------------- -------------------------------------------

Distribution:
 Console                   $  238,662   16% $  196,413   13%       22%
 Hand-held                    122,293    8%     76,973    5%       59%
 PC                            33,019    2%     39,951    3%      -17%
-------------------------- -------------------------------------------
 Total distribution net
  revenues                 $  393,974   26% $  313,337   21%       26%
----------------------------------------------------------------------
 Total net revenues        $1,513,012  100% $1,468,000  100%        3%
-------------------------- -------------------------------------------

ACTIVISION, INC. AND SUBSIDIARIES
FINANCIAL INFORMATION
For the Quarter Ended June 30, 2007

                                ---------- --------- -------- --------
                                 Quarter   Quarter    Year     Year
                                   Ended     Ended     Ended    Ended
                                June 30,   June 30,  June 30, June 30,
                                   2007       2006     2007     2006

------------------------------- ---------- --------- -------- --------
Publishing Net Revenues

 PC                                     3%       13%       7%      16%
------------------------------- ---------- --------- -------- --------

 Console                               84%       67%      73%      45%
------------------------------- ---------- --------- -------- --------
  Sony PlayStation 3                    6%        0%       5%       0%
  Sony PlayStation 2                   34%       38%      45%      36%
  Microsoft Xbox 360                   35%        9%      18%       9%
  Nintendo Wii                          8%        0%       5%       0%
  Other                                 1%       20%

 Hand-held                             13%       20%      13%      14%
------------------------------- ---------- --------- -------- --------
  Sony PlayStation Portable             3%        2%       4%       5%
  Nintendo Dual Screen                  8%        8%       5%       2%
  Nintendo Game Boy Advance             2%       10%       4%       7%

------------------------------- ---------- --------- -------- --------
 Total publishing net revenues        100%      100%      93%      75%
------------------------------------------ --------- -------- --------

SOURCE: Activision, Inc.

Activision, Inc.
Kristin Southey, Vice President, Investor Relations
310-255-2635
ksouthey@activision.com
Maryanne Lataif, Vice President, Corporate Communications
310-255-2704
mlataif@activision.com

Copyright Business Wire 2007

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