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Activision Blizzard Announces Record June Results For Activision

Activision Blizzard, which was formed on July 9 as a result of the closing of Activision's transaction with Vivendi, announced record stand-alone June quarter financial results for Activision, Inc.

For the quarter that ended June 30, 2008, Activision's stand-alone net revenues were $654.2 million, a 32 percent increase, as compared to net revenues of $495.5 million reported for the June quarter last fiscal year. Activision's stand- alone net income for the June quarter was $59.0 million, or $0.18 earnings per diluted share, as compared to net income of $27.8 million, or earnings per diluted share of $0.09 reported for the previous fiscal year's June quarter.

Excluding the impact of expenses related to equity-based compensation of $0.02 per diluted share and one-time costs related to the business combination between Activision and Vivendi Games of $0.02 per diluted share, Activision had non-GAAP net income of $74.3 million and non-GAAP earnings per diluted share of $0.23 for the June quarter. This compares to non-GAAP net income of $32.8 million and non-GAAP earnings per diluted share of $0.11 for the June quarter of the previous year, in each case excluding the impact of expenses related to equity-based compensation.

Separately, on July 24, 2008, Vivendi announced its preliminary June quarter financial results (on IFRS basis) which included results for the business that became part of Activision on July 9, 2008. For the quarter ended June 30, 2008, Vivendi reported 223 million Euros in revenues and 42 million Euros in EBITA for Vivendi Games which includes the results of Blizzard Ent.

Robert Kotick, CEO of Activision Blizzard, stated, "Activision's June quarter stand-alone results were the highest ever for a non-holiday quarter, driven by two new GUITAR HERO titles -- GUITAR HERO: AEROSMITH and GUITAR HERO: ON TOUR -- KUNG FU PANDA and continued sales of our catalogue titles."

Kotick continued, "We have completed our transaction with Vivendi and our integration plans have identified higher than anticipated cost-synergy opportunities. Both Activision and Blizzard Entertainment's businesses have maintained their momentum. Activision Blizzard's combined outlook for calendar year 2008 is set to exceed the comparable calendar year 2009 non-GAAP financial targets that we provided on December 2, 2007, by approximately $600 million in non-GAAP net revenues and $100 million in non-GAAP operating income."

"We are very excited to add Vivendi Games' multi-million unit selling properties CRASH BANDICOOT, ICE AGE and SPYRO, as well as two new intellectual properties -- PROTOTYPE and an as yet unannounced title -- to our game roster," commented Mike Griffith, President and CEO of Activision Publishing. "The combination with Vivendi Games strengthens our holiday slate which is already anchored by three of the top-selling franchises in the industry -- GUITAR HERO, CALL OF DUTY, JAMES BOND and includes such highly anticipated games as CALL OF DUTY: WORLD AT WAR, GUITAR HERO WORLD TOUR and QUANTUM OF SOLACE, as well as CRASH BANDICOOT: MIND OVER MUTANT and THE LEGEND OF SPYRO: DAWN OF THE DRAGON."

Mike Morhaime, CEO and co-founder of Blizzard Entertainment, added, "Since June 2007, WORLD OF WARCRAFT has grown its subscriber base by over 1.8 million, to 10.9 million players. Blizzard Entertainment also continues to launch WORLD OF WARCRAFT in new territories and we are very excited about its recent release in Latin America and the upcoming launch in Russia. Blizzard has a strong pipeline of products in development including WORLD OF WARCRAFT: WRATH OF THE LICH KING, STARCRAFT II and DIABLO III."

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