Activision Blizzard Has Found Its Next Big Franchise
Massive Audience Appeal
Activision Blizzard is no stranger to finding a massive audience in online gaming. The developer's long-running, massively multiplayer, role-playing game "World of Warcraft" is still releasing updates and expansions into it's fifteenth year, and the company's free-to-play online collectible card spinoff "Hearthstone" has over 50 million registered users.
Michael Pachter, equity analyst for Wedbush Securities and video game industry specialist, was on Monday's PreMarktet Prep morning show where he discussed the impact Activision Blizzard's new property has had on the company. "It's probably generated $650 to $700 million in revenue, which would make it the second or third most popular game in Activision's lineup. 'World of Warcraft' is right in there in the $600 to $700 million level," Pachter commented.
Pachter credits the new IP (intellectual property) for propelling Activision Blizzard to an all-time high above $45 this year, and he sees the base of the game growing even more as the competitive "Overwatch" scene develops. "This is a company that does $6.5 billion in revenue, so a $600 million contribution from a single game [...] a new IP, is a big deal."
E-Sports And 'Overwatch'
Following the success of its newest property, Pachter thinks Activision Blizzard is poised to establish "Overwatch" as a major franchise and maybe even a key player in the burgeoning pro-gaming scene. "They're forming a professional e-sports league around 'Overwatch.' There will be tons of opportunity for new players to spend money next year; it's a real franchise," Pachter concluded.
While the domestic audience for e-sports is currently slim, in countries like South Korea, professional gaming events can draw crowds comparable to pro football in America. With a growing number of professional leagues cropping up, as well as occasional ESPN coverage, "Overwatch's" entry into the e-sports realm could draw more attention to the events.
Listen to the full discussion in the clip below.
PreMarket Prep is a daily trading ideas show that focuses on technical analysis and actionable short term trades. You can listen to the show live every morning from 8–9 ET here, or catch the podcast here.
Image Credit: By Marco Verch (Blizzard: Overwatch) [CC BY 2.0], via Wikimedia Commons
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