Activision Sinks to Lowest in Two Years With Earnings on Tuesday

(Bloomberg) -- Activision Blizzard Inc. sunk to the lowest in two years ahead of fourth-quarter earnings results on Tuesday.

The stock fell as much as 7.3% after Benchmark Co. cut its price target to $68 from $87, citing expectations for fewer "product catalysts" and uncertainty around contributions from mobile and advertising.

Activision is planning layoffs that could number in the hundreds as part of a restructuring aimed at centralizing functions and increasing profitability, Bloomberg News reported on Friday. The video-game maker’s revenue is expected to decline by 2 percent in 2019, down from growth of 4 percent in 2018, according to the average of analyst estimates compiled by Bloomberg News. Adjusted earnings per share are expected to decline 3 percent in the same period, from growth of 14 percent in 2018.

Rival Electronic Arts Inc. rallied as much as 9.6 percent on Monday after some analysts praised the company’s latest game, Apex Legends.

To contact the reporter on this story: Jeran Wittenstein in San Francisco at jwittenstei1@bloomberg.net

To contact the editors responsible for this story: Catherine Larkin at clarkin4@bloomberg.net, Steven Fromm

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