ATVI (Activision) going to rebound?

[vindikation]

OK game over, down over 12% in after hours trading. F*CK!

No more individual stock trading for me. I'm moving over to long term investments in ETF's. I'll leave the trading stuff to you pros.

Good luck

[Sniper]

SANTA MONICA, Calif., Dec. 14 /PRNewswire-FirstCall/ -- Activision, Inc. (Nasdaq: ATVI) today announced that it expects net revenues and earnings for the third and fourth quarter and full fiscal year 2006 to be lower than the outlook previously provided by the company on November 2, 2005.

Although there are still a number of critical selling days left in the quarter, which ends December 31, 2005, the company anticipates that earnings will be significantly lower than the outlook previously provided. The company has noted the following factors in its assessment of market conditions and the reasons for the changes in performance expectations:

* While a number of the company's products are outperforming the competition in the marketplace, overall the company's portfolio of products are not selling as well as had been anticipated. The company expects lower than anticipated reorders of its most profitable titles. During the quarter, the company significantly increased spending on consumer and trade activity driven in part by competitive pricing actions. As a result, the company expects that its operating results will be disproportionately affected by title and market underperformance.

* Videogame hardware and software market conditions in the U.S. and Europe are weaker than expected. For the October/November period, U.S. software sales were down 20%, as measured by NPD FunWorld, and sales in the month of December are tracking below company expectations. The company has also seen similar trends in the European software market. The weakness in the U.S. and European markets is believed to be driven by an accelerated shift in consumer demand away from current generation hardware and software due to the introduction of new hardware as well as declines in consumer spending.

The company's fourth quarter will also be negatively impacted by the factors listed above and lower than expected catalogue sales.

"Even though we have not yet completed the quarter and there is still uncertainty as the holiday season unfolds, we wanted to provide an update with regard to market conditions and the performance of our portfolio of products as a whole. For the quarter, we still expect to generate significant revenues; however, we are disappointed that our earnings performance will come in substantially below our previous outlook," stated Michael Griffith, President and CEO of Activision Publishing, Inc.

"The midterm market conditions will continue to pose challenges, but we believe we are well positioned to benefit from the long-term positive fundamentals of the videogame business, as we have over the last thirteen years. We recently renewed several high-profile intellectual property licenses for the long term including Spider-Man(TM), X-men(TM) and Shrek. We also have the #1 rated and best selling title on the Xbox 360(TM), Call of Duty 2. We believe the combination of high quality intellectual properties and strong development talent should have a positive impact on our future performance."

The company currently expects to report its final results for the third quarter in late January.

[Sniper]

SAN FRANCISCO (Dow Jones) - Video game publisher Activision Inc. on Wednesday afternoon slashed its profits and sales forecast for the current third quarter as well as the remainder of its fiscal year.

Shares of Activision (ATVI) slid 14% in after-hours trading after a halt on the stock was lifted following the announcement. The shares closed the regular session up 72 cents at $14.30.

The Santa Monica-based company said the shortfall is partially attributable to soft-than-expected sales of its game titles in October and November. Further, the company said its operating results for the quarter would be disproportionately affected by heavy marketing spending to promote its holiday launch slate.

Although Activision did not provide specific projections, the company said its earnings for the third quarter ended December 31 would be "significantly lower" than previously forecast.

"For the quarter, we still expect to generate significant revenues; however, we are disappointed that our earnings performance will come in substantially below our previous outlook," Michael Griffith, CEO of the company's publishing unit, said in a statement.

The company also said its fourth quarter earnings would be below expectations because of lower-than-expected catalogue sales.

Last month, Activision said its third quarter earnings would be 52 cents a share on revenue of $790 million. In the fourth fiscal quarter, Activision had expected 5 cents a share on sales of $226 million. For the full fiscal year, Activision has said earnings would be 52 cents a share with revenue coming in at $1.48 billion.

The company was hoping strong earnings in the current quarter would provide the bulk of its profits as the window contained a full slate of eight titles for retail, including "Tony Hawk's American Wasteland," and the action game "Call of Duty 2" for the new Xbox 360 console.

During the quarter, Activision had expected a warmer consumer reception to two internally-developed titles: "True Crime: New York City" and "GUN."

[Sniper]

Activision Sees Stagnation

By Troy Wolverton
TheStreet.com Staff Reporter
12/14/2005 5:49 PM EST

Activision (ATVI:Nasdaq) poured some coal in investors' stockings Wednesday afternoon, warning that earnings and revenue for the next two quarters will be "significantly lower" than previously forecast guidance.

The video game-software maker blamed the disappointing outlook for the holiday and first calendar quarters on worse-than-expected sales and reorders of the company's titles, price cuts and weak sales overall in U.S. and European markets.

In a statement, Michael Griffith, CEO of Activision's publishing division, acknowledged that the holiday period wasn't yet over and that there was still uncertainty about how the season would turn out.

However, the company had seen enough to feel like it needed to update its outlook, he said.

"We are disappointed that our earnings performance will come in substantially below our previous outlook," Griffith said.

For their part, investors seemed disenchanted. In recent after-hours trading, shares of Activision were off $2.04, or 14%, to $12.26. The company's stock closed regular trading on Wednesday -- prior to the announcement -- up 72 cents, or 5.3%, to $14.30.

The company did not provide new estimates for the coming periods. In November, Activision officials predicted that the company would earn 52 cents per share on $790 million in sales in the current, third fiscal quarter and 5 cents a share on $226 million in sales in the coming fourth quarter.

Analysts had forecast profits of 53 cents a share on $799.3 million in sales in the current period and 6 cents a share on sales of $230.1 million next quarter.

Activision's warning is somewhat unexpected. According to market data from NPD released Tuesday, the company saw strong sales in November.

The company's Call of Duty 2 title was the most popular game sold for Microsoft's (MSFT:Nasdaq) new Xbox 360, and retail sales of Activision's games in the U.S. grew 54% year over year to $97 million.

In contrast, game software sales as a whole fell 18% last month.

The company did not mention which specific titles were selling poorly or which were seeing lower-than-expected reorders. But Activision did say that it was having trouble with reorders on its "most profitable" titles.

Typically, the most profitable titles in a game-publisher's portfolio are those that are developed internally and do not involve outside licenses of content. For Activision, that would likely imply that the reorder problem was affecting games such as Gun and True Crime: New York City, both of which received poor or mediocre reviews.

According to NPD, retailers sold 224,593 copies of Gun last month and just 77,251 copies of True Crime: New York City.

Games in general aren't considered a hit unless they sell at least 1 million copies. Given that the bulk of game sales typically occur in the first several weeks after they are released and that both Gun and the latest True Crime were released last month, the company could have a difficult time turning either of the titles into hits.

Activision's warning is only the latest downcast news from the video game-software sector. Although it didn't issue a formal earnings warning, industry leader Electronic Arts (ERTS:Nasdaq) last week cautioned analysts that it too was seeing weak sales.

Late last month, GameStop (GME:Nasdaq), the leading video-game retailer, lowered its own sales guidance for the fourth quarter.

Meanwhile, November represented at least the third month in a row of disappointing sales results from NPD.

As with other consumer-oriented businesses, video game-software makers garner the bulk of their sales and earnings in the holiday quarter. The industry has been roiled in recent months by a technology transition as hardware makers such as Microsoft rolled out new consoles.

Such transitions typically lead to soft game sales in the short term amid heightened development costs.

Despite the short-term troubles, most analysts remain bullish on the industry's long-term prospects.

[Evan]

[ QUOTE ]
Insider transactions
In the last 6 months, there have been no insider purchases, and there have been 13 insider sales for a total of 3 million shares.

[/ QUOTE ]
I just want to point out that this can be an extremely misleading statistic. Insiders don't always sell becase they don't like the company. Lots of these guys have nearly their entire net worth tied up in the stock. Maybe he wants to buy a house or a boat or pay for his kids wedding or college. Who knows? It's not always a bad thing though.

Edit to say that due to Eliot Spitzer it's probably a bad thing much less often now than it used to be since insiders are likely going to be terrified to sell if it could be seen as dishonest.

[Sniper]

[ QUOTE ]
[ QUOTE ]
Insider transactions
In the last 6 months, there have been no insider purchases, and there have been 13 insider sales for a total of 3 million shares.

[/ QUOTE ]

I just want to point out that this can be an extremely misleading statistic. Insiders don't always sell becase they don't like the company. Lots of these guys have nearly their entire net worth tied up in the stock. Maybe he wants to buy a house or a boat or pay for his kids wedding or college. Who knows? It's not always a bad thing though.

Edit to say that due to Eliot Spitzer it's probably a bad thing much less often now than it used to be since insiders are likely going to be terrified to sell if it could be seen as dishonest.

[/ QUOTE ]

I'm sure that you noted, in this case, I did not give an opinion on the impact of the insider transactions... merely stated the facts! It is useful information to have when looking at a company!

[Evan]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
Insider transactions
In the last 6 months, there have been no insider purchases, and there have been 13 insider sales for a total of 3 million shares.

[/ QUOTE ]

I just want to point out that this can be an extremely misleading statistic. Insiders don't always sell becase they don't like the company. Lots of these guys have nearly their entire net worth tied up in the stock. Maybe he wants to buy a house or a boat or pay for his kids wedding or college. Who knows? It's not always a bad thing though.

Edit to say that due to Eliot Spitzer it's probably a bad thing much less often now than it used to be since insiders are likely going to be terrified to sell if it could be seen as dishonest.

[/ QUOTE ]

I'm sure that you noted, in this case, I did not give an opinion on the impact of the insider transactions... merely stated the facts! It is useful information to have when looking at a company!

[/ QUOTE ]
I know you didn't say it was bad, but I think that's a logical conclusion that most people would draw if they didn't know any better. I'm not sure how useful it is though. Insider buying is a more reliable indicator than insider selling imo. I suppose it's worth looking at, but it requires a lot more background info before it's meaningful.