ACTIVISION BLIZZARD

Analysis of Activision Blizzard share price

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Among the most recent and popular US stocks is the Activision Blizzard group, which you can discover in more detail here. You'll find information on the activities of the group in this detailed file as well as stock market data to know such as its current and historical quotation.

Latest news

Activision Blizzard raises its annual targets

17/08/2021 - 07h51

The video game publisher Activision Blizzard has published its half-year results for the second quarter of 2021. The results are very strong and allow the group to raise its outlook for the whole year.

Elements that can influence the price of this asset:

Analysis N°1

If the group begins to lose market shares in the realm of video games, it seems capable of bouncing back differently by developing its activities in related sectors. This was the case recently with the movie World of Warcraft. This proves that the company could easily use its successful licenses to diversify into other media and generate additional income to counteract possible declines in other activities.

Analysis N°2

While the market for games on game consoles and computers is currently experiencing a slight decline in activity, it’s quite the opposite with regard to online games on smartphones which are experiencing a very attractive increase in demand. The Activision Blizzard group seems to be well aware of this opportunity to diversify its sources of income and already has some games on mobile phones.

Analysis N°3

The Activision Blizzard group, which has now become a mature group, is also basing its expansion on takeovers of other smaller companies.

Analysis N°4

But, one of the major challenges for Activision Blizzard in the coming years will be to succeed in retaining its fans. As we have seen above, the group has already strongly disappointed some of the latter because of the long-awaited release dates too far away along with certain other disappointments. Therefore, it's a safe bet that if the phenomenon persists, the whole brand image of this company will be disparaged.

Analysis N°5

The increasingly high production cost of certain games created by the Activision Blizzard group can also be an obstacle on its results as it requires a sufficient resale price often considered too high by customers.

Analysis N°6

Finally, the group remains subject to computer pirating of some of its games as techniques are modernized and therefore records more and more losses.

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General presentation of Activision Blizzard

The Activision Blizzard group is currently one of the largest designers and publishers of interactive video games and software for consoles and computers.

Most of its turnover comes from publishing games, with product sales in mind, followed by subscription and license sales. It's particularly known for the Call of Duty or Warcraft games.

Activision Blizzard generates most of its turnover in North America and Europe.

Analysis of Activision Blizzard share price
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The major competitors of Activision Blizzard

The Activision Blizzard Group faces some major competitors in the video game industry. We propose you to discover here who are its main opponents in this sector and what are their activities:

Tencent Holding 

This company has existed since 1998 and specialises in internet and mobile services as well as online advertising. Its services include social networking, web portals, online shopping and multiplayer online games. The group also manages the Tencent QQ instant messaging service and operates one of the largest web portals in China. The group also owns the WeChat application.

Microsoft 

The multinational company Microsoft specialises in IT and is one of the largest market capitalisations on the Nasdaq. The group employs more than 148,000 people in 120 countries around the world. The group is active in computing, cloud, search websites, social networks, email, game consoles and tablets and PCs.

Sony Corporation 

This Japanese multinational company specialises in electronics, telephony, computers, video games, music, cinema and audiovisuals and owns several companies around the world. It is present in 183 countries.

Apple 

Of course, the American multinational company Apple is also a serious competitor, selling consumer electronics, computers and software. The group currently employs 137,000 people and operates 506 Apple stores in more than 25 countries around the world.

Electronic Arts or EA 

This American company was founded in 1982 and is one of the world's leading developers and producers of video games. EA used to be the leader in this sector until 2008 thanks to the purchase of companies and game franchises.

Nintendo 

Finally, the Japanese multinational group Nintendo was founded in 1889 and specialises in the manufacture of video game consoles but also in video game design. It used to produce and market Japanese playing cards and diversified in the 1970s by producing toys and arcade terminals. It is therefore a pioneer company in the video game sector. To date, the Nintendo group has sold more than 800 million consoles of all generations and is one of the leaders in this sector.


The major partners of Activision Blizzard

To finish this article, here are some important partnerships recently set up by Activision Blizzard.

Sony

In 2015, Activision Blizzard partnered with its direct competitor Sony for the development of the Call of Duty video game.

Facebook

In 2016 as it prepared to launch into the field of e-sports, Activision Blizzard signed a major partnership with Facebook for the promotion and distribution of its content on the social network.

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The factors in favour of a rise in the Activision Blizzard share price:

First of all, the Activision Blizzard group enjoys a very interesting positioning on the world market for its sector of activity. It is currently one of the international leaders in the computer games market with 5.8% of the market share and these market shares follow an increase of around 1.4% each year, an increase which should continue at least until 2020 according to forecasts.

The group can also count on loyal customers. As proof, Activision Blizzard organizes an annual convention each year which is entirely dedicated to its games and derivative products which attract players from all over the world and whose entrance tickets are sold in just a few minutes. This influx of visitors proves the general public's interest in the company and the strength of current and future demand. It is therefore a guarantee of loyalty over time and future sales, some games being highly anticipated by fans.

The Activision Blizzard group has built a solid reputation particularly thanks to the care it has always taken to the quality of its customer relations. It always looks to reduce the waiting time for an answer to a question asked online. To do so, it has implemented several tracking and rating systems for the service quality of their agents and advisers allowing it to improve their performance in terms of responsiveness. However, players are known to dislike waiting when they fail to install or operate a new game or when they are stuck in their game. The interest in customer satisfaction is therefore a real plus for the company's image.

Finally, the Activision Blizzard group can also count on intellectual property which is bearing fruit thanks to various franchises. The group has already developed and edited games that have become real essentials for enthusiasts such as World of Warcraft or Diablo. This group has a true capacity to create addictive games and is likely to meet a huge success with players around the world.

The factors in favour of a drop in the Activision Blizzard share price:

First if the competition in terms of paid games remains relatively low with a leadership position still retained for Activision Blizzard in certain segments, another form of competition increasingly threatens the group's results. These are of course free games or micro-paid games developed by independent developers which are attracting more and more players around the world. Because of this rise of free games or their reduced price, the Activision Blizzard group could see its number of subscribers drop dangerously in the years to come. The company could find it very difficult to position itself on this type of game or reduce its prices given the significant cost necessary for the development of certain licenses.

Some analysts in the video game sector also explain that the Activision Blizzard group could soon suffer the consequences of a lack of renewal of its flagship products on which it has relied for many years. Some licenses that are still profitable today have in fact been in use for more than 20 years and will gradually start to run out of steam. However, Activision Blizzard hasn't yet reported on real novelties likely to shake up the market like some of these old games. In the absence of renewal and new blockbuster of the genre, it could lose some of its players even the most loyal who could be seduced by competing games offering true novelty. The same goes for the speed at which the group's new games or new strands of its large licenses are brought to market. Several years often elapse between the end of one part and the release of the next, which can cause fans to lose patience who once again end up turning to competing games. Remember that the record for waiting between two games in the same saga is 8 years and relates the transition from Diablo II to Diablo III.

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions.
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