Activision Blizzard (NASDAQ: ATVI) Call of Duty: WWII is on track to be a big sales hit and give the broader franchise a much-needed shot in the arm. After years of modern and futuristic themed combat settings, the Call of Duty series' most recent release goes back to its World-War-II-era roots. It's also taken the series back to sales growth.
Continue Reading Below
Soft sales for last year's Call of Duty: Infinite Warfare set up an easy comparison in that regard, but there are plenty of other signs that point to a resurgent swing for one of the gaming worlds biggest properties.
Call of Duty: WWII by the numbers
In light of an overall trend of declining sales over the last five years and a worrying performance for last year's installment, there have been questions about whether Call of Duty is losing its relevance. Following Call of Duty: WWII's Nov. 3 release, those concerns appear much less pressing.
Sales indicators for WWII were strong out of the gate, and, despite issues with the game's online multiplayer mode, have only gotten more promising in the days since its release. The game's number of concurrent players on the PC platform in its first week of release was up 395% compared to Infinite Warfare and came in at the highest levels for the series since 2012. Tracking for the game's first retail sales week in the U.K. showed a 57% increase in physical unit sales compared to last year's franchise installment.
Following that early data, Activision Blizzard published a press release that touted the game's big launch. Here's Activision CEO Eric Hirshberg putting the title's performance in perspective:
Continue Reading Below
Our $500 million opening weekend was not only bigger than Thor: Ragnarok's, it was bigger than the opening weekends of both Thor and Wonder Woman combined. And we're committed to supporting the community with continuous improvements and new content.
For the sake of comparison, Call of Duty: Black Ops 3 posted opening sales of roughly $550 million in 2015. The Black Ops offshoot has been the franchise's strongest performer in recent years, and indications that WWII will put up similar unit sales should be cheered by shareholders -- especially in light of growth for high-margin, full-game downloads and in-game purchases over the last couple years.
Across console and PC platforms, the game recorded its highest opening player engagement in franchise history -- pointing to strong sales for in-game purchases and downloadable content expansions down the line. Adding to the string of good news, WWII posted the best second-week performance for a game in the U.K. market since 2015, and the title has been putting up strong sales in Japan as well.
Call of Duty's digital sales outlook
Game publishers are increasingly relying on in-game purchases and full-game downloads in order to drive profits, and there's some good and bad news for COD: WWII on those fronts. Starting with something investors are likely to celebrate, the game set a record for digital sales on the PlayStation 4 platform -- an honor that was briefly held by Activision's October release, Destiny 2. On the other hand, issues with the WWII's online multiplayer mode prompted the company to delay the rollout of in-game-item purchases until Nov. 21. That's a notable missed opportunity, but early engagement metrics suggest the game should still do pretty well when it comes to in-game sales.
Even before the launch of WWII, the company reported that the franchise had recently recorded its highest-ever, third-quarter monthly user base. With last year's Infinite Warfare not being a huge hit by series standards, this feat was accomplished with the help of new updates for 2015's Black Ops III and an updated version of 2007's Modern Warfare. Staying power for previous series installments and a great launch for WWII suggest the most recent release in the franchise will have a long sales life and strong player engagement that translates to in-game spending.
A good year for Activision
Activision didn't have many big games for release this year, but with Destiny 2 emerging as a big hit, Crash Bandicoot: N. Sane Trilogy dramatically outperforming expectations, and 2016-release Overwatch continuing to put up strong sales, it's been a good year for the video game publisher. A successful launch for COD: WWII gives Activision an unblemished string of hit releases in 2017 and represents a big win for the company on multiple levels.
For one, it shows that Activision's best-selling series still has explosive potential. It also improves the outlook for plans to expand the property to new mediums and formats. The company is working on bridging the property to the big screen and has plans for a connected film universe that's similar to Disney's Marvel Cinematic Universe. Activision Blizzard is also working on bringing the franchise to mobile, with the company's King Digital unit developing a series entry for smartphones and tablets.
As long as WWII's online gameplay issues are resolved quickly and in-game purchases receive a smooth introduction, Activision's latest Call of Duty is on track to be a big win for the franchise.
Find out why Activision Blizzard is one of the 10 best stocks to buy now
Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. (In fact, the newsletter they run, Motley Fool Stock Advisor, has tripled the market!*)
Tom and David just revealed their ten top stock picks for investors to buy right now. Activision Blizzard is on the list -- but there are nine others you may be overlooking.
*Stock Advisor returns as of November 6, 2017