Activision has today announced its financial results for the third quarter and nine-month period of the 2006 fiscal year, which ended on December 31st 2005. Despite experience record net revenues for the third quarter, up 20% to $816.2 million (£466.3 million) from $680.1 million (£388.5 million) in the same period in 2005, Activision also reported that net income during the same quarterly period dropped from $97.3 million (£55.6 million) in 2005 to $67.9 million (£38.9 million). Net revenues for the nine-month period, which ended on December 31st 2005 was also a record figure p from $1.20 billion (£685.7 million) in the same period in 2005 to $1.28 billion (£731.3 million).

Forecasting only a slight increase in net revenues for the fiscal year 2006, which ends on March 31st 2006, from $1.405 billion (£803.1 million) to $1.415 billion (£808.8 million), and for the fourth quarter of FY2006 of between $125 (£71.5 million) to $135 million (£77.9 million), Activision stated that the figures were based on weaker than expected market conditions in the third quarter.

Looking ahead to future fiscal years, Activision announced that net revenues for the 2007 fiscal year ending March 31st 2007 are expected to be slightly above $1 billion (£571.6 million), whilst the outlook for the 2008 fiscal year ending March 31st 2008 sees net revenues of approximately $1.6 billion (£914.7 million).

Making the announcement, Robert Kotick, Chairman and CEO of Activision, Inc., commented, "Net revenues for the third quarter and first nine months of fiscal year 2006 were the highest in the company's history. According to NPD we were the #2 overall software publisher in the U.S. and remain the number #1 market share publisher for the Xbox 360. We ended the quarter with approximately $765 million in cash and short-term investments and $1.2 billion in shareholders' equity...Despite these achievements, we were disappointed with our earnings performance this quarter which was the result of weaker than expected market conditions in the U.S. and Europe due to the transition from current-generation consoles to the next generation of video game systems."

"In the long term, we are planning for market growth that historically follows the introduction of new console hardware. To leverage this future growth and prepare for fiscal 2008, which we expect will be the biggest year in Activision's history, we will continue to focus on investment in our product development resources and intellectual property portfolio, growing our international operations and optimizing our worldwide cost structure and resource allocation," Kotick added.

The expected reductions in net revenues for the 2007 fiscal year comes as the industry begins its transition to the next generation in earnest, though Activision for one believes that its position will return for the 2008 fiscal year.

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