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WoW made up half of Acti-Blizz earnings

Subscription-based WoW business does good reckons analyst

Blizzard's subscription-based World of Warcraft business made up about half of Activision Blizzard's earnings for fiscal 2009, one analyst has estimated.

Arvind Bhatia with Stern Agee said in a Wednesday research note that he expects WoW subscriptions amounted to earnings per share of about 30 cents out of a total 60 cents, or around $400 million total, in the fiscal year ended in December.

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In December, Blizzard announced that WoW currently boasts 11.5 million subscribers worldwide.

With World of Warcraft, Call of Duty, Guitar Hero and other franchises, Activision Blizzard is perhaps an investor's best bet in videogames in a poor economy. But Bhatia said he's still concerned about the publisher's financial guidance.

The analyst lowered his fiscal 2009 Activision estimates to $4.9 billion in revenues and earnings per share of 60 cents, down from $5.2 billion and 65 cents, respectively.

Stern Agee had previously lowered its estimates less than one month ago.

Bhatia said he believes consensus estimates for Activision Blizzard are too high at $5.2 billion in revenue and earnings per share of 69 cents.

In December, Activision Blizzard reaffirmed its full year non-GAAP outlook of $4.9 billion in revenues and $1.2 billion in operating income.

Stern Agee rates Activision Blizzard shares as "buy." Shares in the publisher were up 1 cent to $9.42 in late afternoon trading.

Article supplied by Edge-Online

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