How Does Activision Blizzard’s Revenue And Other Key Metrics Compare With That of Electronic Arts?

Activision Blizzard (NASDAQ:ATVI) and Electronic Arts (NASDAQ:EA) both are engaged primarily in developing and distributing games for video game consoles, personal computers, mobile phones, and the Internet.  Activision Blizzard creates popular games such as Call of Duty, World of Warcraft, and Candy Crush, while Electronic Arts focuses more on e-sports, such as FIFA and NFL, which are its top selling games. Activision Blizzard’s revenue over the recent years was impacted by the acquisition of King Digital, thus resulting in higher revenue growth when compared to Electronic Arts. Activision Blizzard has higher revenues and its revenues are well diversified between console, PC, and mobile. When it comes to profitability, Activision Blizzard again stands better than Electronic Arts, when looked at in terms of adjusted net income margin, which implies that its operations are more efficient than its peer.

In this note we compare both the companies’ revenues and other key metrics. You can look at our interactive dashboard analysis ~ Activision Blizzard vs. Electronic Arts: How Have Revenues & Other Key Metrics Changed Over Recent Years? ~ for more details. Note that Electronic Arts fiscal year ends in March, while Activision Blizzard follows the calendar year.

Activision Blizzard’s Revenues of $7.5 Billion Are Much Higher Than $4.9 Billion For Electronic Arts

• Activision Blizzard and Electronic Arts are both engaged primarily in the gaming business.
• Activision Blizzard’s revenues have grown from $4.4 billion in 2014 to $7.5 billion in 2018, led by its acquisition of King Digital. Look at our interactive dashboard analysis for more details on Activision Blizzard’s revenues.
• Electronic Arts revenues grew from $4.5 billion in fiscal 2015 to $4.9 billion in fiscal 2019. Look at our analysis on Electronic Arts’ revenues for more details.

Activision Blizzard’s Revenues Grew At A Higher Pace On Average When Compared To Electronic Arts

• Activision Blizzard’s revenue growth over the last 5 years was much higher than that of Electronic Arts, due to its King Digital acquisition. This also explains the jump in 2016 and drop in 2017.
• Activision Blizzard’s revenue grew at a CAGR of 15% between 2014 and 2018, while the figure was 2.5% for Electronic Arts between fiscal 2015 and fiscal 2019. The jump in Electronic Arts’ revenue in fiscal 2017 can be attributed to higher sales of some of its games, including Star Wars, and FIFA.

America Region Accounts For A Significant Portion of Revenues For Both The Companies

• America region accounted for 51% of total sales for Activision Blizzard in 2018.
• For Electronic Arts, the figure stood at 39% in fiscal 2019.

Electronic Arts Is More Dependent On Console Platforms For Its Revenue, While Activision Blizzard Is Well Diversified In Console, PC, and Mobile Platforms.

• Console platform games accounted for 34% of total sales for Activision Blizzard in 2018.
• For Electronic Arts, the figure stood at 67% in fiscal 2019.

Gross Profit Margin For Electronic Arts Is Slightly Better Than That For Activision Blizzard

Activision Blizzard And Electronic Arts’ Adjusted Net Income Margin Have Largely Been In Line

• Activision Blizzard’s adjusted net income margin grew from 24% in 2014 to 28% in 2018.
• The dip in margin seen in 2015 can be attributed to a relatively higher effective tax rate.
• Electronic Arts’ adjusted net income margin grew from 17% in fiscal 2015 to 27% in fiscal 2019.
• The dip in margins in fiscal 2017 can be attributed to income tax expense of $243 million, as compared to an income tax benefit of $279 million in the prior fiscal.

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