Tag Archives: msft

Game Console Cycle Looks Bright For Activision, EA

The current video-game-console cycle still has room to run, providing upside for top game publishers like Activision Blizzard ( ATVI ) and Electronic Arts ( EA ), Piper Jaffray analyst Michael Olson said Wednesday. Olson reiterated his overweight ratings on Activision and EA stock in separate reports. He has a price target of 39 on Activision and 87 on EA. In afternoon trading on the stock market today , Activision was up over 1% to above 31 and EA was up 1.5% to above 62. “The console cycle is in its third year and investors are beginning to ask if we are nearing the ‘peak’ of this cycle,” Olson said. “While some that own these stocks for the ‘cycle trade’ may be selling, we believe there are arguments to be made that consistent growth will come over the next several years and an ongoing mix shift towards digital that will drive margins higher.” Current-generation console uptake rates have outpaced the previous generation, but the installed base has “significant room to grow,” he said. The current-generation consoles are Sony ‘s ( SNE ) PlayStation 4, Microsoft ‘s ( MSFT ) Xbox One and Nintendo ‘s ( NTDOY ) Wii U. “While the uptake rate of hardware in the current console cycle has been tracking 40% to 50% faster than the prior cycle, we believe growth of the installed base is far from over,” Olson said. “Specifically, at this point in the cycle about 40% as many consoles (Xbox One & PS4) have shipped compared to life-to-date shipments of prior-gen consoles (Xbox 360 & PS3).” Sales of previous-generation consoles (Xbox 360 and PS3) reached about 162 million units, while current-generation consoles (Xbox One and PS4) have sold about 60 million so far, he said. RELATED: Activision Blizzard Whiffs On Q4 EPS, Sales; Stock Sinks Electronic Arts Falls On Mixed Q3, Weak Guidance .

Frank Sands Acquires Stake in Netflix

Much of the significant fourth quarter investment activity from Frank Sands ( Trades , Portfolio ), CEO and CIO of Sands Capital Management, an investment management firm that invests in quality growth businesses across the globe, was in familiar

Facebook Hits Milestone With Advertisers On Instagram

Facebook ( FB ) revealed Wednesday that it has more than 200,000 advertisers on Instagram, its video- and photo-sharing site, which began testing ads three years ago. Analysts have kept a close watch on Instagram as a key revenue growth leg for the social media leader, with estimates that revenue from the site could hit $1 billion this year, or about 10% of Facebook’s total. Facebook has been cautious but methodical in rolling out ads on Instagram, as the company says its priority is user experience over revenue. But Facebook has also continued to work with large advertisers and ad agencies. In September, Facebook announced it was boosting efforts to cash in on Instagram with an aggressive expansion of advertising and better analytics and measurement guidelines. It only began introducing video ads on Instagram in Q3 2015. Instagram now has more than 400 million users, up from 300 million last December. Facebook paid about $1 billion to acquire Instagram in 2012. Facebook has about 2.5 million advertisers overall, of which 75% are outside the U.S. Early this month, Facebook announced that it had doubled the length of video ads on Instagram to 60 seconds. Facebook derives more than 96% of total revenue from advertising, with video ads deriving a premium price. Facebook competes with Apple ( AAPL ), Alphabet ( GOOGL ), Microsoft ( MSFT ), Twitter ( TWTR ) and others to attract more advertisers. Facebook is also expected to introduce ads on its messaging platforms, WhatsApp and Messenger, down the road. Facebook CEO Mark Zuckerberg, in the company’s Q4 earnings call late last month, suggested that ads on WhatsApp and Facebook Messenger, which now has 800 million users, are in the works . Image provided by Shutterstock .