Activision Blizzard reported first-quarter revenue of $1.8 billion Monday, in line with Wall Street expectations, though below its first-quarter results of $2.3 billion from 2021.
The video game publisher recorded net bookings of $1.5 billion for the quarter ended March 31, 2022, down from $2.1 billion in the same quarter of 2021. In-game net bookings came in at $1.1 billion, below $1.34 billion a year earlier.
Earnings per share came in at $0.50, below the $0.79 reported in the first quarter of 2021.
The company attributed its weaker performance to lower bookings for Call of Duty and the product cycle timing at Blizzard. Blizzard is currently working on expanding its Warcraft offerings and is planning for the June 2 launch of Diablo Immortal.
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Activision Blizzard also faced increased legal and professional fees due to the anticipated merger with Microsoft. The company hired “several hundred people” in the first quarter, according to the press release, adding to increased expenses.
The video game company also cited the $18 million settlement it reached in March with the U.S. Equal Employment Opportunity Commission. The lawsuit was one of many concerning sexual harassment allegations at the company, which is also in the midst of an insider trading probe.
Additional costs may be on the horizon, as Activision Blizzard reiterated plans to convert all U.S. temporary and contingent quality assurance employees to full-time workers starting July 1. This change, prompted by a QA unionization effort, will see workers’ minimum hourly wage raised to at least $20 an hour.
Activision Blizzard did not issue its own earnings expectations for the current second quarter but said it expects “renewed expansion” in the fourth quarter and going forward. It does not plan to issue guidance, due to its anticipated merger with Microsoft. Microsoft is scheduled to report its third-quarter earnings on Tuesday.
On Jan. 18, Microsoft announced plans to acquire Activision Blizzard for $95 a share, or $68.7 billion. That deal is expected to close in Microsoft’s fiscal year ending June 30, 2023, pending regulatory and shareholder approval.
