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[vinnygambini]

On September 9th, Destiny launched bringing the valuation of Activision Blizzard's stock, ATVI, to 23.73$ at its closing, close to an All-time high of 24.18$.

The past few days however, it seems investors are singing a different tune due to Destiny lukewarm reviews and disappointing sell-through - over 500 million $ worth of shipments were sent out to retailers - nonetheless only 325 million $ sold-through thus far effectively leaving 175 million $ worth of inventory on store shelves.

As such, ever since the launch of Destiny, the stock has now rapidly declined, losing over 10% of its valuation to where it stands currently 21.60$ ish - 1.5 billion $ erased from ATVI's market cap in just a few days.

Any thoughts?

On a side note, ATVI achieved a successful launch of Destiny and I've been enjoying the game thoroughly. It seems investors are worried of the longterm prospects of the game; hence, the decline ATVI's stock.

http://www.cnbc.com/id/102009225
http://www.marketwatch.com/story/ac...of-destiny-worldwide-as-of-day-one-2014-09-10
http://www.marketwatch.com/investing/stock/ATVI

 

[BY2K]

Being the best selling new IP OF ALL TIME isn't enough!?

 

[Begaria]

And I bet they'll just shrug their shoulders, wipe their tears away with that Blizzard money, and wait with bated breath for Advanced Warfare to release.

 

[Altered_Beast]

325$ Million in the first week for a new IP is insanely good. The majority of sales occur within the first two months of a game's launch, so I wouldn't declare it a disaster yet.

 

[jonno394]

Shareholders expected the second coming

 

[NickFire]

Any pressure on Activision to both allow, and give Bungie the resources to improve Destiny beyond paid DLC and sequels, is a good thing.

 

[Moral Panic]

buy on rumour, sell on news

 

[giancarlo123x]

Being the best selling new IP OF ALL TIME isn't enough!?

Nope. And that makes me sad.

 

[ElRenoRaven]

And just another example of why I would never take my company public.

 

[BlazinAm]

They still have Call of Duty to come out later this year, I dunno looks like a end of the quarter sell off by investors.

 

[TatteredHat]

Shareholders got sucked into the Destiny marketing hype-machine as well.

 

[jred2k]

Now THATS a loot drop.

 

[Duxxy3]

Poor reviews probably hurt the long term potential of Destiny.

 

[anexanhume]

325$ Million in the first week for a new IP is insanely good. The majority of sales occur within the first two months of a game's launch, so I wouldn't declare it a disaster yet.

Yeah, lots of people will be buying consoles over the coming months, and destiny is the best answer to the old CoD mainstay with Evolve out of the picture.

I like Bungie and want them to succeed, but I just didn't see enough there with the beta to jump in. I'm not surprised by the hit or miss reviews. If you really love/focus on the elements they do well, you're going to absolutely love the game, so I get it.

 

[Kouriozan]

Yep, weirdest launch of the best selling new IP ever.

 

[Damerman]

i'm a finance nut and i don't give a fuck about this. this is a market over reaction. Fucking full time day traders are scum of the earth...no offense to anyone who is a full time day trader. they read articles to get the gist of whether its good new or bad news, then sell or buy.

 

[Aquamarine]

They still have Call of Duty to come out later this year, I dunno looks like a end of the quarter sell off by investors.

Call of Duty is a shrinking business.

If you look at NPD and GfK data, the IP is losing ground every year with YoY relative losses.

Investors won't be happy about that either...it's just not a good time to invest in ATVI.

 

[CassidyIzABeast]

Shareholders expected the second coming

Activision marketing got to them too.

 

[LegendofLex]

325$ Million in the first week for a new IP is insanely good.

Not when you've spent $500m and still have $175m worth of inventory sitting on store shelves.

 

[Demoehere]

325$ Million in the first week for a new IP is insanely good. The majority of sales occur within the first two months of a game's launch, so I wouldn't declare it a disaster yet.

Actually most sales occur within the first week from pre-orders/hype. Given the bad reviews I don't think it will sell well into the holiday season.

 

[Lactose_Intolerant]

Being the best selling new IP OF ALL TIME isn't enough!?

Depends on how much they spent

 

[MightyHedgehog]

Now THATS a loot drop.

This was funny.

 

[nubbe]

shareholder lawsuit incoming

 

[Aurongel]

Not sure what the news is here, this is par for the course for stock value after a major release. The same happens with Apple and it doesn't even get reported by major news circulations anymore. Granted I might not know all the details of this specific situation but it seems to be the usual "buy during rumors, sell on release" mantra that drives shareholders.

Now THATS a loot drop.

Amazing.

 

[kswiston]

Poor reviews probably hurt the long term potential of Destiny.

just like that sales disaster of a series Assassin's Creed.

 

[RSTEIN]

That's a lot of inventory destined for the bargain bin.

 

[Damerman]

shareholder lawsuit incoming

why do you say that?

 

[hodayathink]

It'll be interesting to see where Destiny's sales will end up by January. If it ends up having decent enough legs to carry it through the rest of this shipment and another large one for the holidays, then I think investors will come back. Though I think I've read that COD and Skylanders preorders aren't tracking as well as their previous versions.

 

[Anth0ny]

Dat AAAA bomba

 

[Vaporak]

Being the best selling new IP OF ALL TIME isn't enough!?

Apparently they expected even more, and over estimating demand by a large amount when you have to mass produce and ship copies ahead of time can be pretty damaging to a business.

 

[evilalien]

ATVI is up over 20% this year handily beating out the major indices. It is perfectly normal for people to take the opportunity to sell some stock after it hit a new high when Destiny released. This really doesn't mean anything unless the stock continues to drop while the greater market is relatively flat.

 

[Balb]

While I'm glad that a lot of people are enjoying the game, I'm also happy that the game wasn't manufactured into being the biggest game of the year.

 

[ScatheZombie]

Being the best selling new IP OF ALL TIME isn't enough!?

Not when your development and marketing costs are also the highest OF ALL TIME.

$325m revenue and >5m units sold is great ... for any game that isn't GTA or CoD. Unforunately, Destiny is budgeted such that they need to be GTA or CoD in order to even turn a profit. It's entirely possible Destiny doesn't break even by the end of the launch week. For most AAA games, not breaking even in your launch week is actually horribly bad.

 

[Living Proof]

I guess it really doesn't matter how well it sold for a new IP or comparatively to other major franchises; if Activision oversold the prospects of Destiny to their investors, they would naturally be disappointed if it doesn't hit what they initially envisioned. That seems to be the case here.

Sounds rather similar to Bungie's final product versus what most people seemed to expect, doesn't it? If you hype something up to astronomical levels, you're only making it worse for the final product's reception

Spoiler

I'm still enjoying my time with Destiny and don't regret my Limited Edition

 

[SneakyStephan]

Shareholders expected the second coming

Well considering 500 million is being spent on destiny they had reason to.

They spent 2x gta5 money for a third of the sales

 

[jonno394]

I think the most pressing thing for shareholders is whether bungie want destiny to be a service like world of warcraft where you release expansions every six to 12 months or whether bungie are gonna aim for numerous sequels over this ten year plan they have.

 

[Spades]

Being the best selling new IP OF ALL TIME isn't enough!?

Not when it costs so much to make and market it.

 

[DylanTackoor]

 

[Shake Appeal]

Now THATS a loot drop.

I salute this post.

 

[KernelPanic]

Shareholders probably got pissed from getting rares from legendary engrams.

 

[Asd202]

Even puts SE to shame .

 

[AmuroChan]

This is the classic market overreaction, buy-low scenario. There's no question that the stock will rebound once the overraction dies down. Oh, and they still got COD coming in November.

 

[Orayn]

Well considering 500 million is being spent on destiny they had reason to.

They spent 2x gta5 million for a third of the sales

1. They didn't spend $500M yet. Ask Bungie.
2. Household name that's been very popular for over a decade vs. New IP, albeit a heavily advertised one
3. It's been one week, Jesus Christ!

 

[jaaz]

You're making some pretty big cause and effect assumptions here.

 

[Seik]

Now THATS a loot drop.

Hahaha oh wow!

Perfect!

 

[Jb]

That 9/10 drop sure killed their YTD momentum. Damn.

 

[Spineker]

$325 million worth of sales and they're still almost 200 million below their projections.

Welcome to the games industry.

 

[Brandon F]

Now THATS a loot drop.

Ok this was good.

 

[Alebelly]

sometimes even that small voice resonates

 

[Asd202]

This is the classic market overreaction, buy-low scenario. There's no question that the stock will rebound once the overraction dies down. Oh, and they still got COD coming in November.

And WoD.