Activision F1Q08 (Qtr End 6/30/07) Earnings Call Transcript

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2007-08-02 18:14:27.0

Tags: Activision Inc.

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Ralph Schackart - William Blair.

Ralph Schackart - William Blair

Good afternoon. Another great quarter, guys. You alluded to and talked about it on the call in terms of increasing guitar production. Do you think you’re at a very good point in front of the holiday season to be able to anticipate demand? If it is an increased demand than you anticipated then can you gear up production to make sure the product is available in the stores?

Mike Griffith

Well, as you know, there is certainly a lead time associated with the hardware production along with its game. But as I said on the call, we have put a lot of effort against increasing and streamlining our product supply situation for guitars on Guitar Hero. We anticipate that we’re fully ready for the demand. If for some reason, we find ourselves short of supply, I think we’re all going to be extraordinarily happy.

Ralph Schackart - William Blair

Great, one follow up, Mike. Now that GTA Force slipped into calendar ?08, does that change your market outlook for the installed base of hardware platforms through the balance of the year?

Bobby Kotick

No, Ralph. Because it’s such a new development we haven’t had a chance to really assess what the changes would be. I would say one possibility is that now Call of Duty 4 is likely to be the number one product on the PS3. But I think it’s a little early to figure out just yet how all of that will get reallocated and what that will do to our business in the quarter.

Ralph Schackart - William Blair

Bobby, do you want to give us any insight as to what Guitar Hero looks like on the Wii at this point?

Bobby Kotick

As you know, we’re very, very excited about it. It’s one of those products that takes full advantage of the capabilities of the Wii and we think consumers are going to be especially excited by it as well.

Operator

We’ll take our next question from Heath Terry - Credit Suisse.

Heath Terry - Credit Suisse

To touch on the GTA issue on a little bit of a different angle. We spent probably the last year-and-a-half so far hearing questions about how you would plan around Halo and GTA. Given what we’ve heard today, is it too late for you to be able to make adjustments on the timing of product that might have been moved around to create room in that September/October timeframe, to take advantage of what looks like will be a big gap during the big month of October from a product standpoint?

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