WOW-less Q1 pulls Vivendi Games down 24 percent

Lack of expansion to Blizzard's omnipresent MMORPG causes games division revenues to drop to €221 million ($342 million); overall Vivendi revenues up 5.2 percent.

What a difference a World of Warcraft expansion makes. Last January, PC gamers worldwide got their latest fix from Blizzard Entertainment in the form of The Burning Crusade. The title was the first expansion to the veteran publisher's best-selling 2004 massively multiplayer role-playing game, which has shattered records both in terms of revenue and subscribers. Burning Crusade didn't perform shabbily itself, selling 2.4 million units in 24 hours--the fastest retail movement of any PC game--before topping the 3.5 million mark in under two months.

Today, the lack of a WOW expansion in 2008 was felt when Blizzard parent Vivendi SA announced its earnings for the quarter ending March 31, the first of its fiscal year. Overall, the multinational conglomerate--which encompasses the Universal Music Group, Canal+ television channel, and Vivendi Games--year-on-year saw revenues rise 5.2 percent to €5.28 billion ($8.16 billion). However, adjusted earnings before interest and income taxes (EBITA) slid 5.6 percent to €1.2 billion ($1.85 billion), compared to the year prior.

Predictably, Vivendi Games--which includes Blizzard and Sierra Entertainment--saw a much steeper revenue decline. Year over year, its revenue slipped 24.1 percent from €291 million ($450 million) to €221 million ($342 million). The change was even more apparent in post-EBITA earnings, which went from €107 million ($166 million) to just €50 million ($77 million). By itself, Blizzard generated €192 million ($297 million) in revenue during the first quarter--or roughly €64 million (€99 million) per month.

However, Vivendi also pointed out that "excluding the allocation of [Games] Group overheads, Blizzard Entertainment's EBITA was €99 million [($153 million)]"--or roughly €33 million ($51.0 million) each month. That figure was sharply reduced by a €34 million ($53 million) quarterly shortfall at Sierra, which Vivendi blamed on "higher costs related to increased investment in Sierra product development and accelerated royalties expense for released products." The loss also included "continued start up expenses for the Sierra Online and Vivendi Games Mobile divisions."

Ironically, Sierra's bumpy quarter may be one of its last. As part of the looming merger of Vivendi Games and Activision, the division is slated to be folded into the Guitar Hero publisher's organization, based in Santa Monica. Under the terms of the $18.9 billion deal--which has already been approved by European regulators--Blizzard, based in nearby Irvine, will retain its current corporate structure within the new company, Activision Blizzard.

Vivendi also used its earnings today to confirm the next World of Warcraft expansion, The Wrath of the Lich King, will indeed arrive later this year. (According to rumors, the game has already entered the alpha-testing stage.)The publisher is also prepping Starcraft II, a new installment in its celebrated real-time strategy series, for release on an as-yet undetermined date.

50 Comments

  • Ground_Zero

    Posted May 16, 2008 11:45 pm PT

    Half Life 2 did bad in the public eye TJsimulation?

  • dilbongo22

    Posted May 15, 2008 5:45 pm PT

    I just cancled my account to WOW 2 days ago. Great game, for a while. I understand that blizz cannot make new content every week, but once you hit 70 and are farming every raid the game is boring. Great game, for a while.

  • TJsimulation

    Posted May 15, 2008 2:01 pm PT

    Vivendi overall, not counting WOW, has games that do bad in the public eye...I mean, look at the crash series....it was destroyed when Naughty Dog and SCEA quit and then Universal gave it to vivendi...only to have them completely change the way the original crash looks and change him into a more recent retarded cartoon character instead of the original crash that many came to know and love...and Spyro...well I won't even go there...

  • MC_Raptor

    Posted May 15, 2008 1:50 pm PT

    lol it's like alcoholics anonymous, I used to play every day, now i've been sober for 4 months. It used to ruin my relationships with my family and friends, but with blizzard not releasing the expansion pack this year, I've been able to give wow the boot. I feel so much better now. Thanks blizzard! HAHA

  • chiller420

    Posted May 15, 2008 1:49 pm PT

    pwnd

  • shawnanthony

    Posted May 15, 2008 12:45 pm PT

    I played since came out, have epic 70, know everything bout game, quit playing 3 months ago... here is problem: It is 2008 and game looks 2004, update the graphics Bliz and we will return!!!! (BUMP THIS) ShawnT

  • gokuxdbz2

    Posted May 15, 2008 12:11 pm PT

    I wonder how much profit will they make off the new 50 cent game.

  • TheProctologist

    Posted May 15, 2008 10:51 am PT

    "How can they lost money with so many subscribers? I swear, none of this financial stuff makes sense anymore..."

    They didn't lose money, they just made less than last year at Q1, 24% less. Which isn't surprising since last year they released Burning Crusade, and are currently developing WoTLK (Release = +money, Dev = -money).

  • buzzguy

    Posted May 15, 2008 10:43 am PT

    How can they lost money with so many subscribers? I swear, none of this financial stuff makes sense anymore...

  • quietcool72

    Posted May 15, 2008 10:35 am PT

    You know, its funny, I guess the "new chic" is for people to post everywhere and proudly declare that they have quit and they think the game has gone down-hill. It's usually the Raid-leetz who are mad that now PVP'ers can get top gear through their playstyle too, and the Raid-babies aren't happy that theirs' is not the only path towards high quality epic gear.

    Its also funny that some people are mad about the flying mounts. Seriously, how fun would it be to go to Northrend and never have to explore and just hop your epic (mount name here) and skyrocket through the content. Come on... Big deal...7 levels without the mounts...big deal..you get 'em again at 77.

  • chrisdojo

    Posted May 15, 2008 9:44 am PT

    i hit lvl 70 with one toon and i'm done. there isn't much left to WoW IMO. in the new expansion, they are revoking the flying mounts until lvl 77, and the mount took a bit to get in the first place. i subscribed for a total of 8 months over 1.5 years and i'm done with WoW.

  • andyrae11

    Posted May 15, 2008 9:27 am PT

    Maybe, just maybe, some of the WOW players are realizing that their families and jobs are more important than they thought?

  • vest816

    Posted May 15, 2008 8:41 am PT

    I like how wolvklaw described his experience. I've seen similar things happen to many other people. In college, I was sitting next to a guy in an introductory 3d modeling class. Simple, easy stuff. All you needed to pass was semi-average attendance, the ability to draw a crude scribbly house on lined paper, and a pulse. This guy managed to fail the class, but he was honest with his answer. He blamed it on World of Warcraft, emphasizing his own shortcomings to handle a gaming addiction and poor time management.

    I know for a fact that I suffer from the same traits. My time management sucks, and I become addicted to just about any natural element that comes into contact with my body. I refused WoW because I knew it would hijack my life just as it did to many other people, and I instead opted for what I call the "quick fix" kinds of games. Guitar Hero, DDR, Luminess, whatever game could deliver the full immersion experience in five minutes or less reigns tops in my playlist.

    But regarding the actual topic at hand. WoW is one of those phenomenons where it will only sell in retailers shelves for so long. The selling doesn't stop because of bad reviews, poor publicity, or the like. It will shatter records for 24 hours, and then when all five-hundred billion people contemplating purchasing the game have purchased it, there's nobody left to sell it to. Kind of like the XBox360. The other consoles (namely, PS3) are catching up and surpassing the 360 not because gamers are preferring one over the other, but because everybody who would be in the demographic to purchase a 360 already has one.

  • waleedarshad

    Posted May 15, 2008 8:38 am PT

    WoW was all about pve now that they are focusing on PvP its starting to go kinda downhill , trying to balance every 1 for pvp affects pve aswell i hope they dont screw up for wratch

  • ShootingS

    Posted May 15, 2008 8:32 am PT

    If you have played a game for 2 years, how can it not get repetitive and boring?

  • Sins-of-Mosin

    Posted May 15, 2008 7:52 am PT

    My buddies want me to come back and play WoW pretty badly. They are getting bored and need people to come back. They don't even joke about it being a part time job anymore. It's their life now.

  • swamptick

    Posted May 15, 2008 7:41 am PT

    Can't wait for Wrath of the Lich King

  • Montrealien

    Posted May 15, 2008 7:04 am PT

    people ar leaving the game? Did I miss something?

  • IDarkNight

    Posted May 15, 2008 6:48 am PT

    I played WoW for about 2 years but i leaved WoW because is so boring now. Ok, is a excellent game but now the game are the same all the time. The PvP is so bad, and the PvE is only the same. I'm waiting now AoC because i'm searching PvP all time.

    WoW is going down slowly because Blizz don't listen (or don't see) why the people is leaving the game.

  • Montrealien

    Posted May 15, 2008 6:32 am PT

    @Wolvklaw

    Good for you man. Well said. ;D I guess, in the end, the message is, we are all snow flakes, lol

  • wolvklaw

    Posted May 15, 2008 6:17 am PT

    You are right as it is "my" fault for not controlling an addiction. I started playing WoW during the original beta, lasted untill I was completed with my Tier 2 set. By then I no longer had any control over my time. I did not have the patience to play it in a way that did not interfere with my social, work, school life. I compare wow along the same lines as I compare a drug like meth. It is not Blizzards fault, it is or "was" my fault that I lost my self control. In the end I had no choice but to sell off my account and quit entirely. If I kept that account, it was like living next door to a dealer, for me to stop my addiction I had to get away from all of the elements. It is my fault for allowing it to happen, but that is also why I stand by those that no longer play. I will always miss the game, however it took that game for me to realize what I as a person needed to do to maintain self control. Even now knowing what I do, I know that if I were to start playing again, I would loose the battle and WoW would win. For me to win, I can't play. WoW is a wonderful game, Blizzard made it so well that no one else in the MMORPG market can compete, It doesn't even seem like anyone is even bothering anymore lol. I respect it and admire it. But for me my self control only applies when I don't play, then I can keep that in check and keep myself not in the game. By the way I am just responding to the discussion about WoW addiction, not by anymeans is my purpose to slander or degrade those that do play. As long as your life has the balance it needs, then I give props. I know that for me, this game robs me of that balance, which is my fault for not keeping that self control. That which I can maintain with my 360, I love the pause button

  • darkfox101

    Posted May 15, 2008 6:14 am PT

    i jsut got done playing WoW lol!

  • Montrealien

    Posted May 15, 2008 5:18 am PT

    It's all about perspective and self control. Some people can control it, others can't. It is like that for everything. Galiard said...

    (the statment you made about " my girl friend leveled up 3 level 70's and shes fine” is redicous. its like saying, "ya i drink non-acholic beer and i didnt become an alcholic. ")

    That is my perspective, and my situation, who are you to say it is ridiculous? And your metaphor is simply bizarre, getting to 70 is as bad a time sink as any other... Btw, her main is a warlock named Pinka who is raiding SSC atm. I have one 70 wich never got to 60 in time to raid and now raids SSC. Took me 3 years to get to 70. It is all situational, I stand by my statement.

  • Galiard

    Posted May 15, 2008 4:59 am PT

    your right and wrong at the same time when you say that wow is not addicting. doing quests leveling up characters to level 70's and the occisonial karazhan raid wont hurt the players social, school, or work life. the addicting part is end game, alot of people play games to beat them. yes you can only goto the 1 raid a week due to your work schedual but you will miss your chance at the items that your class needs. so you cut night school on that tuesday night, and to goto the gruul raid to get a chance at your shield so that other people wont get it before you or you don’t goto work one day to do that karazhan raid where you would be garanteed the drop. the statment you made about " my girl friend leveled up 3 level 70's and shes fine” is redicous. its like saying, "ya i drink non-acholic beer and i didnt become an alcholic. " world of warcraft end game or any MMORPGs end game for that matter is the addictive part. at the end game you dont go on raids cause you enjoy it, sure you did the first time. but now its the 20th time and you jsut want your Tier 4 helm. At this point you hate running kara and just want your damn helm. its more like " i shoot heroine not to get high because i need to level my self off"

  • generalvonngene

    Posted May 15, 2008 4:54 am PT

    BYE BYE SIERRA....

  • riceboyzz

    Posted May 15, 2008 4:22 am PT

    gin_rummy89 Games like WoW are much more dangerous to children then violent video games are such as GTA4, WoW addiction is a serious issue. Blizzard is the video game equvilent of that sleazy dealer on the corner...

    If you don't believe me just go to the WoW website, download the free trial... And remember only the first taste is free! lol agreed thats how i got to wow since jan of 08 haha

  • Montrealien

    Posted May 15, 2008 4:06 am PT

    I love how the minute we got a WoW article a bunch of people come in and comment on how they will never play it, it is dangerous, blah blah blah....


    Millions of people play this game and as long as you are mature and have a head on your shoulder you will be fine, as a loading screen in the game state, all things are to be taken in moderation....even wow. I raid with mature couple as our raid and guild leaders that would never even come to a site like this, my girlfriend just got her bachelors, all while getting 3 70's. Heck, Kurt Schilling is in the same Horde guild as me on Earth Ring. The stereotypes and knee jerk judgments about games like wow on this site are just that, kneejerk reactions from people that have no clue what they are talking about.


    P.S. If you have a sad story because of wow, gf left you, you lost your job, you lost friends, yada yada yada, it was not the games fault....it was your fault.

  • Beaglesniffer

    Posted May 15, 2008 1:57 am PT

    WOW......

  • sickside6

    Posted May 15, 2008 1:06 am PT

    cool

  • gin_rummy89

    Posted May 15, 2008 12:44 am PT

    Games like WoW are much more dangerous to children then violent video games are such as GTA4, WoW addiction is a serious issue. Blizzard is the video game equvilent of that sleazy dealer on the corner...

    If you don't believe me just go to the WoW website, download the free trial... And remember only the first taste is free!

  • jsmoke03

    Posted May 14, 2008 9:40 pm PT

    blizzard's coming out with starcraft 2 so no worries

  • Pete5506

    Posted May 14, 2008 8:58 pm PT

    I never got into Wow and I glad I didnt

  • DraginHikari

    Posted May 14, 2008 8:48 pm PT

    @gamefreakwill & unknown-racer That is the fault of those who can't control themselves and nothing more

  • gamefreakwill

    Posted May 14, 2008 7:54 pm PT

    I'm done with WOW after my payment ends May 20, Age of Conan time for me after that! WOW's ruined a lot of lives, and my social life somewhat took a beating on it, it sucked bad. Now i'm off the "warcrack" and am going for better, less time spending and addictive MMO's if i'm interested, and Age of Conan seems to have a better fit for me.

  • darkspineslayer

    Posted May 14, 2008 7:00 pm PT

    i have never seen the point of WoW...or MMos in general

  • unknown-racer

    Posted May 14, 2008 6:42 pm PT

    I think WoW is a very smart MMO that just trying to make money out stupid people who got no life that all... 10million player paying 15buck a month that $150,000,000 buck Blizzard is making big fat buck. Goooooo Blizzard take all the money from the low life people make them skip work just so that cause raid with there guild and get fire from there job...

  • PS3_3DO

    Posted May 14, 2008 5:55 pm PT

    I bet you'll soon be seeing a WoW cart racing game. LOL

  • maximo

    Posted May 14, 2008 5:53 pm PT

    I played WoW for over 3 years and recently quit.

    The game is repetitive beyond words. This goes for both PVE and PVP. I hope they make some changes. This game encourages re-running the same stuff over and over and over again. It is a huge grind and does not reward any kind of skill.

    Shame on Blizzard for developing 'more of the same stuff" for BC. I see no change for Wrath.

    I hope Wahammer can make an impact

  • EPaul

    Posted May 14, 2008 5:51 pm PT

    So without WoW their sales are sluggish hope they dont milk WoW

  • ColdfireTrilogy

    Posted May 14, 2008 5:32 pm PT

    um to everyone below saying this is an end to wow etc .... are you guys ... oh nvm. Of COURSE revenue is going to go down when an exp isnt released in a quarter ... thats a DUH statement ... doesnt mean wow is dying or anything close to that. People cant buy a non existent new product. The second WoTLK comes out ... guess what that number is going to spike again... you forget the number of subscribers to WoW anyway ... next time think before posting. BTW even the devs for Warhammer Online know its not going to be a WoW killer, its almost pure pvp based at this point because surpasing wow at everything it does is impossible to do from the release, instead they are doing a heavy pvp approach and tailoring to those who want great pvp which ... is gonna rock dont get me wrong i think Warhammer is going to be bangin' but to say its gonna take wows place ... not likely, too many non hardcore players that wow is tailoring to .

  • Confirmed_Kill

    Posted May 14, 2008 5:28 pm PT

    Warhammer Online should take WOW's place soon enough anyway.

    Of course that's assuming it ever comes out haha.

  • trippleclick

    Posted May 14, 2008 5:10 pm PT

    The age of WoW is slowly coming to an end. Probably a good thing for a LOT of walking Q-tip gamers who haven't seen the light of day for a long time. (I was one of them for several months)

  • halosniper52

    Posted May 14, 2008 4:54 pm PT

    And btw for all u ppl talking about them making a X-pac a year they already said they would like to start doing that so heads up.

  • halosniper52

    Posted May 14, 2008 4:53 pm PT

    "grafkhun"

    looks like it will be about the size of the last one BC but im not shocked that wow is droping a bit alot of my friends have stoped playing and so have i now and im moving on to age of conan so im done with wow.

  • grafkhun

    Posted May 14, 2008 4:49 pm PT

    how much content is speculated in the next WoW expansion anyways? i don't play wow but i'm just wondering, b/c i've heard a lot of mixed reactions towards the burning crusade expansion.

  • patton101

    Posted May 14, 2008 4:49 pm PT

    I've been playin WoW for about 2 years and recently quit a month ago. Probably for good. It's gotten boring and to the point now where you have to devote at least 10 hours a day to keep up with things. Grinding dailies, long long raids, gathering this and that to help the raids, grinding reputation, etc. It's just too much now.

  • Icehearted

    Posted May 14, 2008 4:30 pm PT

    I have to wonder if anyone other than the really devoted players even care about the added grinding and aimless gear chasing WotLK offers. I really had fun for the first couple of weeks with TBC, but by now I just don't see the fun anymore. I guess what I am saying is maybe they put way too much stock in how important WOW is while more interesting titles like SC2 and Diablo3 are pushed a bit to the side.

  • GoldenRamoth

    Posted May 14, 2008 4:26 pm PT

    an new WOW every year? that'd be horrible. lol, imagine a new player... "OMG! $100 for all the expansions.. plus the game.. then $15 a month? no way!"

    Every year. would. be dumb.

  • chibi-acer

    Posted May 14, 2008 4:25 pm PT

    I just hope they don't use this thinking to justify releasing a new WoW expansion every year. Unless they finally get around to adding player owned housing...

  • GoldenRamoth

    Posted May 14, 2008 4:22 pm PT

    WOW, i could prolly pass on. unless i wasn't too cheap to pay for it. then i'd MAYBE play it. =P

    But starcraft 2. awesome. looking forward to that.

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