ATVI – Market expectations are for continued ROA compression, and management is concerned about advertising, partner networks, and in-game revenues

• Activision Blizzard, Inc. (ATVI:USA) currently trades below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 14.3x Uniform P/E, implying bearish expectations for the firm. Moreover, management has concerns about their advertising performance, partner network issues, and their ability to sustain elevated in-game revenue levels
• Specifically, management may be concerned about their advertising performance, and may be exaggerating the success of their recent major launches. Additionally, they may lack confidence in their ability to sustain elevated in-game Call of Duty revenue levels, and to maintain increased overall engagement in Call of Duty Black Ops 4. Moreover, they may lack confidence in their ability to maintain strong participation in World of Warcraft value-added services, and may be concerned about their partner network challenges. Furthermore, they may be exaggerating the success of the Overwatch League expansion, and their excitement about the return of World of Warcraft Classic