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GAME ON! - 52243

Available at Prezzip.com GAME ON! prezi template. Business is just a game when you play it well. Create your own business game!
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Transcript of GAME ON! - 52243

GAME ON!
Financial Analysis of Activision Blizzard and Electronic Arts
Our Recommendation...
Activision Blizzard
No current legal obligations
Recommendations
Sales
$3,797 million

Net Income
$ 98 million

Goodwill
$1,974 million

Major Events
Buy back of $300 million in shares
Electronic Arts
EA's Finances
SEPARATE ELEMENTS
These 2 rectangular corners are
png files that you corp anyway you like!
Background
American developer, marketer, publisher and distributor of video games
Headquartered in Redwood City, California.
Founded and incorporated on May 28, 1982, by Trip Hawkins
Fifth-largest gaming company by revenue (2015)
Market
The fastest growing part of their business is online and wireless gaming
Develop, market, publish and distribute game software content and services for various platforms
Most sales from disk-based video game products sold through retailers
Competitors
Activision Blizzard
Nintendo
Ubisoft

Offerings
2013 Overview
2014 Overview
Stated Risks
Delay in launch
Online services disruption and outage
Consumer Piracy and Data policy
Channel partners
Key personnel
Piracy
Infringement of 3rd party intellectual property
Competition success
Normal risks (taxes, dollar strength, stock, etc.)
Legality
Law suits
Geoffery Pecover
$27 million accrual settlement
Illegal monopoly of NFL games
Robin Antonick
Sued EA for $16 million + punitive damages + disgorgement of profits
EA is confident they will win the case and they won't owe any money
Ryan Hart
Sued for unspecified amount in 2009 and reopened in 2013.
Claimed EA misappropriated his likeness.
Collegiate Athletes
In 2009, many former collegiate students sued EA, NCAA, and Collegiate Licensing Company (CLC).
In 2013, came to an agreement, EA recognizes $30 million to settlement.
Activision Blizzard
Background
American video games publishing company
Headquartered in Santa Monica, California.
Activision started in 1979
First independent developer
Blizzard started in 1991
First called Silicon and Synapse
Merged in 2008
Sixth largest video game company by revenue (2015)
Market
Online
2nd in sales
Subscription
Online downloads
Xbox/Playstation
Xbox top selling platform
Physical copy sales down
Direct down load increased
Platform transition
slowed sales in PS3 and Xbox 360
demand higher than expected for next gen platform
Selling Season
4th quarter historical the highest sales
Competitors
Offerings
2013 Overview
Sales
$4,583 million Net Revenue

Earnings
$1,010 Million

Goodwill
$7,568 Million

Major events
July 25, 2013, Activision Blizzard announced the purchase of 429 million shares from majority owner Vivendi ($5.83 billion)
Completely independent company

2014 Overview
Sales
$4,408 million Net Revenue

Earnings
$835 million

Goodwill
$7,548 million

Major Events
Launch of Destiny Series
Stated Risks
Fx
Operate in 5 currencies
Euro exchange most impact
Interest rate
Short term investment variability
1% change = $25 million
4.41 billion in money market funds 2013
4.85 billion in money market funds 2014
Legality
No legal issues disclosed
ROR and Balance Sheet
Liquidity Ratios
Financial Leverage
Financial Comparison
GO
STOP
Better Return
Better Current Ratio
Lower Debt Ratio
Dividend Payout

Higher and Increasing EPS
Consistency

Questions?
Presentation by
Profitability Ratios
Platforms
Microsoft Xbox series
Sony Playstation series
Nintendo Wii series
PCs
Mobile
Tablets
Online
Titles
Battlefield
Madden
Need for Speed
Sims
Sales
$3,757 million

Net Income
$ 8 million

Goodwill
$1,900 million

Major events
Buy back of $750 million in shares

Alok Dand
Lacey Montague
Jordan Gilbert
Gabe Trefz
What is Electronic Arts?
Sony
Microsoft
EA
Tencent
Ubisoft
Platforms
Microsoft Xbox series
Sony Playstation series
Nintendo Wii series
PCs
Online
Titles
World of Warcraft series
Call of Duty series
Diablo series
Guitar Hero series
What's happening?
What is Activision Blizzard?
What's Happening?
27.4
27.4
11.2
11.1
4.9
4.0
41.6
55.9
11.0
32.2
35.8
15.2
2.29
.61
5.12
1.31
1.04
1.41
1.21
1.12
408
748
.32
.55
.03
.58
ROR and Balance Sheet
Liquidity Ratios
Profitability Ratios
Financial Leverage
3836
4195
9.72
15.3%
17.0%
8.22
2.60
2.06
2.55
2.03
Working Capital vs Current Ratio
Inventory Turnover vs ROI
Trend Analysis
Activision Blizzard's Finances
Trend Analysis
GO
STOP
GO
STOP
Working Capital vs. Current Ratio
Inventory Turnover vs. ROI
10.37
5.24
22.95
58.72
29.32
84.63
8.06
4.76
18.9
86.34
40.92
77.79
.96
.053
.51
1.14
.056
.527
ROR vs. NASDAQ ROR
ROR vs. NASDAQ ROR
EA
EA
Activision Blizzard
Activision Blizzard
1.24
1.36
2.14
2.04
Mobile Expansion
Full transcript