Diablo III Launching May 15th, Activision Blizzard Ready for Action

by Trefis Team
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Trefis
ATVI
Activision Blizzard
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After months of speculations and followed discussions, Activision Blizzard (NASDAQ:ATVI) has finally confirmed May 15th as Diablo III’s official release date. [1] With the announcement, the company has now opened digital pre-sales of the game via Blizzard’s digital distribution platform Battle.net. Additionally, Activision has also tactfully linked World of Warcraft (WoW) with Diablo III, by providing free Diablo III copies to WoW’s annual pass users.

We believe the company is all set to gain in the coming months because apart from capitalizing the ongoing Diablo III frenzy, Activision will also gain from increase in WoW annual pass subscription increase. Activision Blizzard competes with other game developers like Electronic Arts (NASDAQ:EA), Take-Two Interactive Software (NASDAQ:TTWO) and casual gaming mainstays such as Zynga (NASDAQ:ZNGA).

See our full analysis for Activision Blizzard here

Company looks all set to gain from Diblo III frenzy

Diablo III has been one of the most awaited role playing game (RPG) to be released in 2012. The high anticipation of Diablo III can be judged by the fact, that in past few months slightest hints of the release date of Diablo III were enough in raking massive discussions on leading gaming forums. Additionally,  fervent discussions on Diablo III on gaming forums acted as catalysts in increasing the visibility of the game. See: Activision Gets Great Buzz from Diablo 3 Release Speculation

With the confirmation of official release date, we expect pre-sales number to swell going forward. Diablo III is already enjoying the numero uno status on U.S. pre-orders chart, with the latest pre-sales figure standing at 449,155. [2]

Activision will also benefit from increase in WoW’s annual pass users

In order to address its decling WoW subs, Activision has tactfully linked WoW with Diablo 3, by providing free Diablo 3 copies to WoW’s annual pass users. We believe it’s a great move, and considering the current Diablo III craze in gaming circles, it will definitely help the company to improve its falling WoW subs. The numbers stand testimony to this, with 1 million players  already signing up for the World of Warcraft Annual Pass.

Trefis maintain $17.58 price estimate for Activision Blizzard, which is roughly 40% above its current market price.

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Notes:
  1. Diablo III Launching May 15th, Source: Activision Blizzard’s IR []
  2. U.S. pre-orders gaming chart, Source: Vgchartz.com []
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