Because some people are getting a little too excited over next-to-nothing, lets actually look at everything said recently from everyone’s favorite video-game producer.
“Call of Duty: Advanced Warfare was the #1 release of the year and the franchise’s cumulative revenue is now over $11 billion. Destiny was the #3 new release of the year and attracted over 16 million registered users. Skylanders, with over 240 million toys sold life to date was, again, the #1 kids console game. World of Warcraft reached over 10 million subscribers and remains the #1 subscription-based MMORPG in the world. Diablo III is the #1 PC role-playing game of the year; and Hearthstone, which is named Game of the Year, has already attracted more than 25 million registered players.”
Quick, which one of the above numbers isn’t directly linked to generating money?
“Destiny and Blizzard’s Hearthstone. Combined, they attracted over 40 million registered players worldwide and generated more than $850 million in non-GAAP revenue”
Why are we grouping the 3rd biggest release of the year with a title that struggles to stay in the top 200 of app downloads? Why o why… (Don’t worry, we’ll get back to that 850m number later, but spoiler alert: nope)
“Blizzard generated record avenues and near-record operating income. The year was driven by Diablo III: Reaper of Souls and World of Warcraft: Warlords of Draenor, both of which generated significant revenues and income that will not have comparable releases this year. In addition, we expect WoW subs to decline as we have seen historically in the year following the release of a large-scale expansion.”
So wait, a title sometimes in the top 40 in app revenue wasn’t a driver of record revenue? What, we couldn’t lump it in here somehow? Why do we exclude Hearthstone when we start talking about significant revenues? (Props to Blizzard for realizing WoW subs will drop (have already?). Maybe release content that holds up to avoid that? I heard Old Blizzard was able to do that, maybe ask them how they did it during vanilla/TBC times?)
“Turning to our quarterly outlook. In 2015, we expect a lighter first half of the year as compared to last year as we don’t have a comparable launch to the high-margin Diablo III: Reaper of Souls, and we only expect modest contributions from Call of Duty Online and Heroes of the Storm, as I mentioned earlier.”
Wait a minute, but what about your new tent-pole Hearthstone? It’s still ‘growing’! And it wasn’t as big a factor in Q1 2014, so Q1 2015 should be awesome right? Right…? Hello?
Actual numbers talk below:
“(CoD)Advanced Warfare the #1 console game globally, which has delivered well over $1 billion in sell-through, and far and away the #1 title worldwide on next-gen platforms.”
“Destiny now has over 16 million registered users with a massive audience of active players still averaging over 3 hours of game play per day, a figure that has stayed remarkably stable since launch. Destiny also performed the rarely seen console gaming feat of growing active players from November to December, driven by the release of the new expansion pack, the Dark Below. And it was the #1 played game in North America on a PS4 in December.“
“On to our third tent-pole franchise, Skylanders. As of today, life-to-date retail sales for Skylanders has exceeded $3 billion. And in 2014, Skylanders outsold all action figure lines and was the #1 kid console game globally for the fourth year in a row, and as a franchise, outperformed its nearest competitor by 30%.“
One of these tent-poles is not like the other…
Strange isn’t it, that they give us numbers like player activity for Destiny, or actual sales numbers for Skylanders, or game sales rankings for CoD. Wonder why they didn’t just group them all together, or only provide how many free accounts were created. What, was the number of ‘likes’ on Facebook for each title not a number worth mentioning? Are dollar figures really that important on an earnings call?
“Hearthstone was released first on Windows and Mac and later on iPad and Android tablets, bringing Blizzard into the mobile space for the first time.”
And not just bringing Blizzard into the mobile space, but damn near cracking the top 200 downloads chart at that. Take that “Random shitting slot machine app” at number 201, Blizzard is here to ‘dominate’ the mobile space with its very own graphic dice simulator!
“All this activity helped drive Hearthstone’s highest monthly active players ever in December as well as our highest revenue quarter-to-date for Hearthstone”
Ah final, here come the real numbers…
“Registered players for the game have now reached over 25 million, capping off a spectacular start for Hearthstone. It’s gratifying for us to see how the global Blizzard community has responded to our first foray into a new genre as well as the free-to-play market and gaming on tablets. We’ll keep working hard to build on last year’s momentum with more content in 2015 as well as the upcoming Android phone and iPhone versions of the game.”
And…. that’s it?
Just “keep working hard”?
The big take away number is that a free process that takes maybe a couple of minutes was completed 25m times to date. That’s the only concrete number in this entire report about Hearthstone; the number of free accounts created. What, was Turbine unavailable to provide number of cards draw or something equally meaningless?
Why can’t I get Destiny-like activity numbers, or Skylander-like sales numbers? Why isn’t Blizzard telling us that Hearthstone is the #1 mobile app? The #10 mobile app? What, is stating you are maybe sometimes a top 50 revenue app not a good look for a Warcraft IP, Blizzard-backed, WoW-boosted new app? Do investors not want to hear that?
The only somewhat concrete and significant line about Hearthstone is here:
“We created 2 new tent-pole franchises with Destiny and Hearthstone that are profitable right out of the gate. Destiny and Hearthstone also have great comp and pipelines that we expect to contribute to our results every year in a significant way.”
Destiny coattails aside, Hearthstone is profitable, so it has that going for it. Who would have imagined using existing WoW art to lower the development costs of your dice simulator and cashing in on your very popular IP would result in quick, not-going-to-give-a-number profits. Really shocking. It’s almost like any low-cost turd (the game runs like a dog on the ipad, which is impressive considering there is almost nothing going on graphically OR in terms of data being sent compared to most other multiplayer apps) put out by Blizzard that had WoW behind it and cost a few bucks to make would have been a quick small success, huh?
I wonder if the tent-pole line was a little dig from Activision to Blizzard. Like one side launched Destiny, while the other launched Hearthstone, which is sorta like coming up to a new Ferrari owner and telling him how awesome your new Kia is. I can just imagine someone from Activision patted the intern doing the copy/paste work for Hearthstone on the head and handing him a celebratory lollipop. “Great work nerfing gravedigger kid, can’t wait to see what huge update you deliver next month!”
Good try, good effort?
PS: How about Brian J. Pitz just bringing the heat during the Q&A?
“Brian J. Pitz – Jefferies LLC, Research Division
Our question on Hearthstone monetization. The game is already a big hit. We continue to be impressed with the size of Twitch audiences, suggesting basically off-the-charts engagement.”
Think Brian realizes its one fame-whore on Twitch who streams 24/7 that makes up 80% of those Hearthstone views? (Which I just checked, are now 1/3rd of LoL, and yes, the one-fame whore is streaming.) Better keep that guy on the payroll Blizzard or that “off-the-charts” engagement might go down, and we just can’t have that now can we?
PPS: Dear Az, you might want to rethink that indicative reasoning math there bud. I mean sure, maybe every single dollar collected by Destiny was on the first day, and it was just zeroes after that right, but somehow I just kinda doubt it.
I believe we call that kind of next-level analysis”when Hearthstone players do math”, and it’s about as entertaining as rolling graphical dice to determine a world champion. To the unstable portal everyone!