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Activision to Bank on Crash Team Racing, Brings New Features

Zacks Equity Research

Activision Blizzard’s ATVI decision to not have any major releases in 2019 is expected to have an adverse impact on the company’s top line in the near term.

The company is expected to bank on its upcoming release Crash Team Racing Nitro-Fueled that has been developed in collaboration with Beenox.

Crash Team is expected to release on Jun 21 and will feature online and offline multiplayer racing. The players get to race with Crash Bandicoot series characters and save the planet from destruction.

Further, the game’s high-display (HD) graphics provide players with a remarkable view of the cars crashing and their slide around the corner in the racetrack. In a bid to lure users, Crash Team is also coming up with the self-proclaimed fastest racer car in the galaxy, Nitros Oxide.

Activision Blizzard, Inc Price and Consensus

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A Look at the New Features

Crash Team Racing Nitro Fueled is primarily a makeover of the original game Crash Team Racing released in 1999.

The company’s recent announcement states that the game is also bringing back tracks, karts, arenas and battle modes from the 2003 release, Crash Nitro Kart (CNK). The game will be launched with all 13 racing tracks that were present in CNK and the remastered content will be available in HD.

Users can play the game at Sony’s SNE booth in PAX East Boston between Mar 28 and Mar 31. Players can have an early experience of Crash Team Racing tracks: Papu’s Pyramid and Sewer Speedway and two remastered Crash Nitro Kart tracks: Clockwork Wumpa and Electron Avenue.

Further, the players owning PlayStation will be entitled to receive exclusive retro-themed content of the game.

Can Other Popular Franchises Aid Activision?

Activision’s biggest problem is that it depends heavily on a handful of franchises namely Call of Duty, World of Warcraft, Overwatch and Kind Digital’s Candy Crush that make up more than 70% of its revenues.

Although the release of Call of Duty: Black Ops 4 in fourth-quarter 2018 aided Activision Publishing’s revenues, the game’s sales were lower than management’s expectation in the second half of the quarter due to lower retail demand and pricing. Moreover, in-game net bookings were low initially in the reported quarter.

Further, Blizzard witnessed a decline in monthly active users (MAU) due to underperformance of World of Warcraft. In-game net booking for both Overwatch and Hearthstone declined sequentially.

Notably, declining bookings and MAUs are expected to drastically hurt Activision’s financial performance. Activision is expected to face intensifying competition from the likes of Electronic Arts EA and Take-Two Interactive TTWO, which is expected to negatively impact growth in the near term.

Activision currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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