Blizzard 2009 Annual Report Download - page 18
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TheCODMreviewssegmentperformanceexclusiveoftheimpactofthechangeindeferrednet
revenuesandrelatedcostofsaleswithrespecttocertainoftheCompany’sonlineenabledgames,
stockbasedcompensationexpense,restructuringexpense,amortizationofintangibleassetsandpurchase
priceaccountingrelatedadjustments,impairmentofintangibleassets,integrationandtransactioncosts,and
other*.Informationontheoperatingsegmentsandreconciliationsoftotalnetrevenuesandtotalsegment
income(loss)fromoperationstoconsolidatednetrevenuesandoperatingincome(loss)fortheyearsended
December31,2009,2008,and2007arepresentedbelow(amountsinmillions):
(*) RepresentsNonCoreactivities,whicharelegacyVivendiGames’divisionsorbusinessunitsthat
wehaveexited,divestedorwounddownaspartofourrestructuringandintegrationeffortsasa
resultoftheBusinessCombination.PriortoJuly1,2009,NonCoreactivitiesweremanagedasa
standaloneoperatingsegment;however,inlightoftheminimalactivitiesandinsignificanceof
NonCoreactivities,asofthatdateweceasedtheirmanagementasaseparateoperatingsegment
andconsequently,wearenolongerprovidingseparateoperatingsegmentdisclosureandhave
reclassifiedourpriorperiods’segmentpresentationsothatitconformstothecurrentperiod’s
presentation.
Note—ThehistoricalfinancialstatementspriortoJuly10,2008arethoseofVivendiGamesonly.
ThefinancialinformationofthebusinessesoperatedbyActivision,Inc.priortotheBusinessCombination
isincludedfromthedateoftheBusinessCombination(i.e.fromJuly10,2008onwards),butnotforprior
periods.WeprovideadiscussionandanalysisoftheoperatingsegmentsfortheyearsendedDecember31,
2009,2008,and2007intheSupplementalProFormaInformationsectionbelowastheproformabasis
providesgreatercomparabilityfortheActivisionandDistributionsegmentsastheSupplementalProForma
InformationreflectspreBusinessCombinationbusinessespreviouslyoperatedbyActivision,Inc.The
Blizzardsegmentisnotaffectedbyanyoftheproformaadjustments.
FortheyearsendedDecember31,
2009
2008
2007
Increase/
(decrease)
2009v2008
Increase/
(decrease)
2008v2007
Segmentnetrevenues:
Activision...................................................................................
$3,156
$2,152
$272
$1,004
$1,880
Blizzard......................................................................................
1,196
1,343
1,107
(147)
236
Distribution.................................................................................
423
227
—
196
227
Operatingsegmentnetrevenuetotal..............................................
4,775
3,722
1,379
1,053
2,343
Reconciliationtoconsolidatednetrevenues:
Neteffectfromdeferrednetrevenues........................................
(497)
(713)
(40)
216
(673)
Other*.........................................................................................
1
17
10
(16)
7
Consolidatednetrevenues..............................................................
$4,279
$3,026
$1,349
$1,253
$1,677
Segmentincome(loss)fromoperations:
Activision...................................................................................
$663
$307
$(13)
$356
$320
Blizzard......................................................................................
555
704
568
(149)
136
Distribution.................................................................................
16
22
—
(6)
22
Operatingsegmentincomefromoperationstotal...........................
1,234
1,033
555
201
478
Reconciliationtoconsolidatedoperatingincome(loss):
Neteffectfromdeferralofnetrevenuesandrelatedcostof
sales........................................................................................
(383)
(496)
(38)
113
(458)
Stockbasedcompensationexpense............................................
(154)
(90)
(137)
(64)
47
Restructuring..............................................................................
(23)
(93)
1
70
(94)
Amortizationofintangibleassetsandpurchaseprice
accountingrelatedadjustments...............................................
(259)
(292)
(4)
33
(288)
Impairmentofintangibleassets..................................................
(409)
—
—
(409)
—
Integrationandtransactioncosts................................................
(24)
(29)
—
5
(29)
Other*.........................................................................................
(8)
(266)
(198)
258
(68)
Totalconsolidatedoperatingincome(loss)................................
$(26)
$(233)
$179
$207
$(412)