ATVI – Market expectations are for Uniform ROA to compress, and management may be concerned about the Call of Duty franchise, new offerings, and player engagement

• Activision Blizzard, Inc. (ATVI:USA) currently trades below corporate averages relative to UAFRS-based (Uniform) earnings, with a 19.1x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management may be concerned about their Call of Duty franchise, new offerings, and player engagement.
  
• Specifically, management may lack confidence in their ability to sustain monthly active users (MAUs) and strong premium sales across the Call of Duty ecosystem, as well as capitalize on long-term opportunities from Call of Duty Mobile and Diablo. Furthermore, they may have concerns about launching new core premium content, differences in engagement and player investment as countries reopen, and the impact of changes in Apple’s ecosystem on the King franchise. Finally, management may lack confidence in their ability to increase user acquisition and release compelling new features, events and seasons, specifically for Call of Duty Mobile and Candy Crush.