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Posts with tag billions

WoW generates half of Acti-Blizz earnings

The folks over at CVG picked up an interesting note on our Activision-Blizzard overlords' 2008 fiscals. According to Arvind Bhatia, World of Warcraft probably generated 30 cents out of each 60 cents per share of earnings. Put another way, that's about $400 million for shares at the end of the fiscal year ending this past December.

Now, this is kind of the best guess of Mr. Bhatia, who works under the firm Sterne Agee. (And they certainly have a reputation that says we could probably believe them.) But even without Sterne Agee's reputation, a little back-of-the-envelope math shows that his analysis probably bears fruit. We already know that WoW has 11.5 million subscribers. At $15 dollars a pop per month, you're already looking at $172 million each month. But we know that a lot of folks have discount plans, and the charge isn't the same across the globe. I can easily believe a $400 million yearly earning from subscriptions, and am actually surprised it's not higher.

Of course, Bhatia has recently lowered some of his other estimates for ATVI, and warns that the consensus estimates predicting $5.2 billion in revenue are probably too high. Nonetheless, at the end of the day, this does say that World of Warcraft is doing just fine. We can feel free to threaten to quit over the latest nerf, the lights're going to stay on while we're out the door.

Filed under: Analysis / Opinion, Blizzard, News items

Vivendi makes $1.5 billion in 2007, BC pushes Blizz up 58% from 2006

A few days ago we tried to estimate how much Blizzard was making from those 10 million accounts, but now we know for sure: it's actually around $1.2 billion (which is up 58% from 2006). Now, you can probably see that that's only $500 million short of the estimate that we were trying to prove was wrong, but don't forget that the $1.2 billion isn't just subscription fees-- it includes all those sales of Burning Crusade last year at full release price. What Blizzard earns from subscription fees is just part of that total.

Still, a $1.5 billion year for Vivendi (especially when their other games divisions actually dropped by almost 30%) is good news for them. Of course, the question they (and more specifically, Activision Blizzard) have to be wondering about is if the success can continue. If Blizzard can release a new expansion this year and hold off the coming threats in the MMO industry, they'll be looking at even bigger numbers in 2008. But that's a lot to ask-- there's no question Vivendi (and Activision) will come up with huge amounts of profit this year, but growth of this magnitude will be a tough hill to climb.

Filed under: Analysis / Opinion, Odds and ends, Blizzard, Economy

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