Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Activision Blizzard, Inc. (ATVI): Pause This Game for a While, You Might Be Better off Exiting It

But wait, this is not the only front where The Walt Disney Company (NYSE:DIS) would be making life difficult for Activision Blizzard, Inc. (NASDAQ:ATVI). The company has turned to Activision’s rival, Electronic Arts Inc. (NASDAQ:EA), for developing games based on the Star Wars franchise. Electronic Arts has prior experience with its Star Wars: The Old Republic MMO game (which it converted into a free-to-play game and this has paid off), and the publisher’s famed studios will work onStar Wars. Throw in the release of Battlefield 4 from Electronic Arts Inc. (NASDAQ:EA) later this year, and I see things getting even more difficult for Activision.

And yet, I haven’t spoken about the upcoming release of the latest installment one of the most successful game franchises ever, Grand Theft Auto V from Take-Two Interactive. Thus, with so many strong franchises from strong developers on the way, it remains to be seen how Activision’s best games, including the Call of Duty, franchise would perform. Till last year, I used to be pretty sure that Activision’s CoD would sell in record numbers, but I’m having some doubts this time.

Final words

Apart from these concerns, the ongoing transition in the gaming industry, which I’d discussed in my previous post on Activision, is another factor that could weigh on the company in the near-term. The proliferation of mobile devices, and casual gaming along with, and innovative, Android-based consoles such as the Ouya and the NVIDIA Corporation (NASDAQ:NVDA)’s Project Shield indicate that the video game industry is changing.

Nintendo’s Wii U failed to surpass its predecessor in terms of sales, and if Microsoft Corporation (NASDAQ:MSFT) and Sony Corporation (ADR) (NYSE:SNE)’s upcoming consoles fail to re-ignite the growth, then the going might be difficult for Activision. Thus, with so many changes happening, it would be prudent to wait and watch from the sidelines as to how Activision Blizzard, Inc. (NASDAQ:ATVI) emerges once the console cycle refreshes.

The article Pause This Game for a While, You Might Be Better off Exiting It originally appeared on and is written by Harsh Chauhan.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.