When it's all said and done, the future of the Call of Duty franchise may really be black. Despite Call of Duty: Black Ops 2's massive launch, which generated $500 million on its first day at retail, Sterne Agee analyst Arvind Bhatia believes the franchise could be on the decline.
"We believe unit sales of Call of Duty: Black Ops 2 are tracking down double digits year-over-year," Bhatia said. "Our checks show initial sales of CoD: Black Ops 2 at some retailers were down as much as 20 percent. Subsequently, it appears sales of CoD did pick up a bit over the Thanksgiving holiday."
"We think the current sales curve suggests CoD: Black Ops 2 unit sales in its first year could ultimately be down 10 percent to 15 percent year-over-year," he revealed. If the company is correct, Bhatia confirmed this would be the second year in the row Activision's behemoth franchise has seen units decline. According to Bhatia, Modern Warfare 3 is down an estimated 5 percent versus the original Black Ops.
"We estimate CoD generates 40 percent to 45 percent of the company's EBIT on an annual basis and it goes without saying that weakness in this franchise is a cause for concern."
So what's causing the potential decline and overall sales disappointment for Black Ops 2? Bhatia noted a few reasons like "slightly lower" ratings when compared to MW3; the release of Halo 4 a week before; and Black Ops 2's awkward release right before Thanksgiving, giving people hope of potential deals and discounts. Of course, those discounts never came — did you honestly think they would with a game as hyped as Black Ops 2?
Things certainly won't get easier for Activision and Call of Duty. Looking forward to next year, Bhatia said we'll likely see the release of another highly-rated Battlefield game, while pointing out EA's deal with Respawn could lead to something even greater in 2014. Yes sir, the competition in the FPS market will only stiffen.
With that being said, have you enjoyed Call of Duty: Black Ops 2?
[GI.biz]
