Activision Blizzard: Why Is “Mobile & Other Platforms” The Most Important Segment?

The Mobile and Other Platforms segment contributes just 15% to Activision‘s net revenue (2016 estimate) but it accounts for over 35% of the company’s value as per our estimates. This can be attributed to the expected growth in the segment’s revenues going forward as well as the acquisition of King Digital, which not only brings incremental revenues, but also providers immense growth potential. King Digital, the publisher of the popular Candy Crush series, has over 500 million users, and Activision plans to leverage its reach to bring its classic games — World of Warcraft and Call of Duty — to mobile.

Even though mobile and social games are a very small part of Activision Blizzard’s gaming portfolio, they are a part of its growth strategy. The company’s strategy makes sense considering that the mobile gaming domain provides lucrative growth opportunities. The number of mobile games in the U.S. increased from 80 million in 2011 to 165 million in 2015, and the figure is expected to cross 200 million by 2018.

Have more questions on Activision Blizzard  (NASDAQ: ATVI)? See the links below.

• What Is Activision Blizzard’s Revenue & EBITDA Breakdown?
• By What Percentage Have Activision Blizzard’s Revenues And EBITDA Grown Over The Last Five Years?
• What’s Activision Blizzard’s Fundamental Value Based On Expected 2016 Results?
• How Has Activision Blizzard’s Revenue And EBITDA Composition Changed Over 2011-2015?
• Where Will Activision Blizzard’s Revenue And Gross Profit Growth Come From Over The Next Three Years?
• Activision Blizzard’s Console Market Share Witnessed A Decline In 2015; Digital Channels Provide Respite

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