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Activision loses 50M MAU Year over Year (Q1 2021 vs Q1 2022)
- Thread starter dex3108
- Start date
Vanguard absolutely stinks and Caldera was a massive downgrade from Verdansk. They'll get the numbers back when MW2 Reboot and Warzone 2.0 drops.
Release malaise on the mainline series, a 'We don't know what the fuck we are doing' regarding Warzone from forced & sloppy integration with the mainline titles to cheaters becoming such a problem you had a soft boycott by streamers over the summer.
Oh yeah, and the company is literally run by and pro-sex abuser. Like imagine a brand so bad it got to the point they tried to hide Activisions names in the leadup to Vanguard, lol
Modern Warfare 2 will make cash hand over fist because of the name alone along with IW building off a solid reboot but in an industry where it's all about growth above all MW2 has it's work cut out for them.
Oh yeah, and the company is literally run by and pro-sex abuser. Like imagine a brand so bad it got to the point they tried to hide Activisions names in the leadup to Vanguard, lol
Modern Warfare 2 will make cash hand over fist because of the name alone along with IW building off a solid reboot but in an industry where it's all about growth above all MW2 has it's work cut out for them.
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The tenor of VG discussion and specifically mergers makes it a bit of a hot button to discuss but if you look at the trends for CoD, WoW, and the other major ABK core IPs coupled with the harassment/descrimination cases and staffing issues its pretty hard to argue the for $69B Microsoft isn't buying the absolute "peak" of the current entity's worth.
A small number of investors who were trying to stop the acquisition were implying that the company was undervalued.
That growth wasn't sustainable. I mean, the pandemic was still ongoing so that probably played a big part as well.
Obviously Vanguard struggling doesn't help either.
Obviously Vanguard struggling doesn't help either.
I think will be back above 400M in the next months. ABK has a big line-up coming in, especially on mobile (not counting King's own pipeline which remain unannounced, currently they had 250M MAU over the last quarter):
Modern Warfare 2
Diablo Immortal
Warzone 2
Warcraft Mobile
Diablo 4
Warzone Mobile
Overwatch 2
World of Warcraft Dragonflight
Rumored F2P COD Zombies experience ?
Notably, Diablo Immortal passed 30M pre-registrations, this with Dragonflight should boost significantly Blizzard's MAU numbers. Then Overwatch 2, Diablo 4 and Warcraft Mobile.
According to Activision's projections and estimates, 2023 and 2024 appear to be important years, especially for Blizzard.
Modern Warfare 2
Diablo Immortal
Warzone 2
Warcraft Mobile
Diablo 4
Warzone Mobile
Overwatch 2
World of Warcraft Dragonflight
Rumored F2P COD Zombies experience ?
Notably, Diablo Immortal passed 30M pre-registrations, this with Dragonflight should boost significantly Blizzard's MAU numbers. Then Overwatch 2, Diablo 4 and Warcraft Mobile.
According to Activision's projections and estimates, 2023 and 2024 appear to be important years, especially for Blizzard.
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I would argue too much. This news for example wouldn't be great for share price. MS is paying pretty close to ABK's all time high, a value achieve during the early bounce back from the pandemic where VG companies were blowing up due to the captive audience. As that has cooled and the work place issues surfaced they'd already lost significant value from that point. We've now seen lots of info on how both CoD and WoW have bled active users. Nothing as definitive that I've seen but the discourse and coverage around Overwatch/Overwatch 2 doesn't sound any better. The rest of their major IPs are in various states of disrepair as well, with Starcraft all but forgotten, same with non-WoW Warcraft, and Diablo while still active isn't the only game in town and has something of an identity crisis to work through. And on the Activision side they've not been servicing other IP besides CoD for YEARS effectively.
There is a lot to work with, don't get me wrong, and Microsoft could do a lot just with the back catalog on GamePass, but $69B is a big fucking number to then clean up someone else's staffing nightmare, refocus/rebuild creative teams that seem to be floundering (pretty likely from executive mismanagement so I guess thats a "plus" in that they're buying out the single biggest problem), and get compelling new projects using all these people and IP into active production that isn't the kind of cynical bullshit ABK is becoming known for and that is driving these kinds of userbase declines.
ABK is worth more to GamePass than probably any other single collection of IP, so its hard to say its a bad move for MS, since money is only relevant to them in two ways: how much power does it buy and how does it look as a measure of success/RoI. I'm dubious that in 10 years time MS will look back at $69B for ABK as a real good RoI, but it is indisputably a big power purchase from day one.
Man, I genuinely forgot that was a real thing that happened. I wonder if they will continue that tradition at 2023 Microsoft game showcase, titled "Xbox & Bethesda Games & Beenox & Demonware & Digital Legends & High Moon Studios & Infinity Ward & King & Major League Gaming & Radical Entertainment & Raven Software & Sledgehammer Games & Toys for Bob & Treyarch".
I think will be back above 400M in the next months. ABK has a big line-up coming in, especially on mobile (not counting King's own pipeline which remain unannounced, currently they had 250M MAU over the last quarter):
Modern Warfare 2
Diablo Immortal
Warzone 2
Warcraft Mobile
Diablo 4
Warzone Mobile
Overwatch 2
World of Warcraft Dragonflight
Rumored F2P COD Zombies experience ?
Notably, Diablo Immortal passed 30M pre-registrations, this with Dragonflight should boost significantly Blizzard's MAU numbers. Then Overwatch 2, Diablo 4 and Warcraft Mobile.
According to Activision's projections and estimates, 2023 and 2024 appear to be important years, especially for Blizzard.
Those Blizzard segment projections are interesting. I wonder which title they expect to be the best performing. Diablo 4, Immortal or OW2? The next 2 years are going to be fun.
I totally see your point but MS was probably aware of these deteriorating figures at the time of the agreement. ABK must have shared MAU and other indicators updated to their date of negotiation along with some projection. In fact, if this really were the case of extreme, unexpected news on a key indicator, then they probably would adjust the price accordingly once the deal goes thru.
I'm not dismissing your point, but I'm just assuming MS knew what they were getting into and the price might cover for drivers such as Game Pass (which you mentioned) and the mobile side of the business, which MS see as a part of their future but they have nil expertise on.
It's so interesting seeing ABK upcoming lineup and seeing this headline. Microsoft really swooped in at the perfect time to grab them.
MW2/WZ2 will be huge
WoW Dragonflight will be huge
Diablo Immortal will be huge
Overwatch 2 will be huge
Diablo 4 will be huge
Warzone Mobile will be huge.
And I'm sure I'm missing a few.
It's like there was a QTE to get Activision and they nailed it.
MW2/WZ2 will be huge
WoW Dragonflight will be huge
Diablo Immortal will be huge
Overwatch 2 will be huge
Diablo 4 will be huge
Warzone Mobile will be huge.
And I'm sure I'm missing a few.
It's like there was a QTE to get Activision and they nailed it.
Definitely. It's really crazy how little games Activision makes nowadays but the IP they own is incredibly lucrative. Perfect timing from Microsoft
There's an interview with former CEO Steve Balmer, where he candidly states that Microsoft had considered acquiring Activision "a number of times", and that they got it at "good price". Apparently the $68.7 billion they paid was two thirds of what Activision was worth before the workplace abuse allegations came to light?
Not to say that Microsoft won't have work cut out for them when it comes to integrating and managing ABK, but from a longer term perspective they get a pretty significant increase in workforce (which is important if you intend on keeping a subscription service stocked up with a consistent stream of content), Blizzard content remains popular in China (which is one of the reasons why Activision merged with Blizzard in the first place), and King gives them access to a very lucrative mobile market. $68.7 billion is a considerable sum of money, but a lot safer to invest in a struggling business that still has strong IP, talent and technology powering it than trying to start completely from scratch.
COD had a massive hit and Blizzard was struggling for a bit as well. It seems like that's largely getting resolved. The delay for 2024's COD gives Call of Duty team 3 year cycles again. Blizzard is working on a ton of projects including their survival IP and the unannounced FPS game. I wouldn't be surprised if after the deal goes through and we get a proper ABK showcase, we see a lot of games officially announced out of ABK.
The staff alone are worth a truckload in addition to the IP for GamePass. Staffing is fucking impossible in the industry right now; there's tons of cash floating around but not enough literal bodies to take stuff on. Ubisoft has a ton of employees, and they still have over a thousand open positions posted on their website (for example). That's a huge reason that MS jumped on this acquisition. Their employee count is going to skyrocket, and they can allow the CoD cycle to slow down a bit for teams to get back to work on other games (to fill GamePass with). ABK was pulling people off of stuff left and right to get CoD out, and clearly they couldn't keep that up. But if they ever didn't release a mainline CoD, their shares would plummet. MS doesn't have to care about that as much, and would probably prefer a year without CoD if it meant devs cranked out 3 other smaller titles that they could drip into GP throughout the year.
It's all gonna go back up with MW2 and Warzone 2. Other genres and games wish they had those kind of numbers.
MS is getting Activison Blizzard at a bargain price. This deal wouldn't have even happened if their
share prices hadn't tanked due to the workplace issues.
Deals like this almost always involve a company buying another for a share price much higher than the current market price so don't let that fool you. Microsoft would have had to spend close to $100B to buy Activison blizzard before the scandals hit the news.
share prices hadn't tanked due to the workplace issues.
Deals like this almost always involve a company buying another for a share price much higher than the current market price so don't let that fool you. Microsoft would have had to spend close to $100B to buy Activison blizzard before the scandals hit the news.
That's a huge loss, but when the number's that high, I don't know how it will end up mattering anyway. Activision cited Destiny 2 as underperforming even though it was breaking the franchise's records at the time. A 33% loss in MAU is probably a big deal for them even though there's like 100M players left.
I'm sure Microsoft knows exactly what they're doing. How do you define paying too much for a scarce opportunity to buy several of the biggest IP in the world? What alternative is there? EA? Not really comparable when you consider how much of their biggest releases are licensed and/or sports games. Ubisoft? Not one single IP worth comparing to ABK's top 3-4.
Then add the fact that its Microsoft, one of the handful of richest companies in the world. They make more than ABK's market cap as annual profit if I recall.
Look at it this way: If a private equity group paid $69B for ABK do you think they'd realize return on the investment in any kind of reasonable window? By ABK's own projections for the next several years peak revenue would take 5-7 years to recoup. At least in industries I've been in that is a borderline rate of return. If ABK misses on some of those projections (almost certainly if you ask me) its more like a 6-8 year return.
But again, for Microsoft its just numbers on the end of a ledger, the assets they're getting border on priceless for what MS is trying to do in the gaming space, which ties directly into their cloud ambitions, which is a core pillar of the entire company. So even if they did overpay that 1. doesn't make it a mistake and 2. who is going to give a shit at the end if they overpaid by $5B?
That workforce is going to be in significant disarray and need a ton of work, but yes, that is clearly a big part of the hook. Microsoft has struggled in starting new studios that then ramp up to full production size in a reasonable timeframe. Arguably their biggest weakness. So acquiring a solid core and expanding from there is clearly big value for them.
And yes, the ABK portfolio is still very good, I just don't see how a real world assessment would put it so close to peak value despite everything going on, including the way ABK has been managing that portfolio of IPs.
Given that however, maybe that is off-set by what will effectively be MS having a ready-made opportunity to white knight the whole thing. Imagine the global fan response if the deal closes and within 12 months Microsoft is talking Starcraft 3, a Diablo 4 that manages to check all the boxes for everyone and is on GamePass day one. Clarify the CoD pipeline and provide the breathing room for the various CoD studios to actually do something compelling. Shit, imagine if they do a CoD where you play a Ukrainian Foreign Legion squad. The opportunities to reintroduce/re-frame some absolutely iconic IPs with huge core audiences who feel either a little or a lot disappointed in the current status quo at ABK are endless.
In short I think there is a real chance a theoretical alternative buyer not much smaller than MS would be writing their own obituary at that price, but Microsoft is in a position to care less about the money than about the opportunities that money buys.
Hell, maybe not even just a smaller company. Imagine if it was Google or Amazon. Would anyone have faith that they'd turn around staffing issues and IP management in any kind of real timeframe?
Its a crazy industry right now where Microsoft can pay so damn much and still probably be the only valid buyer capable of saving ABK from itself.