Both EA and Activision are benefiting in the stock market, following better than expected financial results reported earlier this week.
Games Industry reports EA shares increased nearly 17 per cent to $32.72 earlier today, while Activision was up 7 per cent to $20.58.
"We believe EA has the lineup to deliver solid revenue and EPS growth in its out year. With the return of Battlefield and Need for Speed, EA is positioned to deliver significant revenue growth in FY:16,” Wedbush analyst Michael Pachter said.
We expect digital revenues to grow by at least $200 million a year, and believe that EA can grow its overall revenues by $400 million next year. Assuming it keeps its costs in check, the company should be able to deliver $0.50 or more in EPS growth in FY:16.”
Pachter also praised Activision’s 2014 slate, stating that it’s clear the publisher has distanced itself well from the issues originally posed by declines in its core franchises’ sales.
"The company has overcome concerns about declines for its core franchises. Skylanders withstood an onslaught from a competitive product to achieve record sales; Call of Duty sales declined only slightly, and are expected to rebound this year from a stronger franchise with less competition; and World of Warcraft subscribers appear to have stabilized.
We think that brand extensions and expansion packs for Blizzard’s three core franchises can keep its revenues stable for a long time, and it may see revenue growth when it launches a new MMO, expected in 2015 or 2016. We also see a bright future for the launch of Call of Duty China expected sometime early next year."