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32
A C T I V I S I O N , I N C . • • 2 0 0 7 A N N U A L R E P O R T
Nintendo Wii Net Revenues
(in thousands)
March 31,
2007
% of
Publishing
Net Revenues
March 31,
2006
% of
Publishing
Net Revenues
Increase/
(Decrease)
Percent
Change
$54,636 5% $— —% $54,636 n/a
The Nintendo Wii was released in November 2006. Consistent with our goal of having a significant
presence at the launch of each next generation platform, we released five titles concurrently with the
release of Wii: Call of Duty 3, Marvel: Ultimate Alliance, World Series of Poker: Tournament of Champions, Rapala
Tournament Fishing, and Tony Hawk’s Downhill Jam. With the strong consumer demand for the platform,
our five releases performed well, three of which were top ten Wii titles in the third quarter of fiscal
2007, according to NPD Funworld: Call of Duty 3, Marvel Ultimate Alliance and Tony Hawk’s Downhill Jam.
We expect net revenues from sales of titles for the Wii to significantly increase with the growth of the
installed base and an increase in the number of titles on our slate for fiscal 2008. Due to its mass
market appeal, we believe that the Wii will provide a significant opportunity for us in the upcoming
fiscal years.
Nintendo GameCube Net Revenues
(in thousands)
March 31,
2007
% of
Publishing
Net Revenues
March 31,
2006
% of
Publishing
Net Revenues
Increase/
(Decrease)
Percent
Change
$22,761 2% $80,964 7% $(58,203) (72)%
Net revenues from sales of titles for the Nintendo GameCube decreased 72% from $81.0 million for
the year ended March 31, 2006 to $22.8 million for the year ended March 31, 2007. The decrease in
absolute dollars and as a percentage of publishing net revenues reflects a decrease in the number of
new releases in fiscal 2007 compared to fiscal 2006 and a significant slowdown in sales on the
GameCube platform as customers transition to the next generation platforms. In fiscal 2006, we
released nine major titles: Madagascar, Tony Hawk’s American Wasteland, Ultimate Spider-Man, Fantastic Four,
Call of Duty: Big Red One, True Crime: New York City, GUN, Shrek SuperSlam and X-Men Legends II. This
compares to fiscal 2007 when we released four titles: Over the Hedge, X-Men: The Official Game, Shrek
Smash n’ Crash Racing, and our European affiliate title, LucasArts’ LEGO Star Wars II: The Original Trilogy.
We expect net revenues for the GameCube to significantly decrease in fiscal 2008. Net revenues will
be generated from catalog sales only, as we will no longer develop titles for this platform.
Hand-held
(in thousands)
March 31,
2007
% of
Publishing
Net Revenues
March 31,
2006
% of
Publishing
Net Revenues
Increase/
(Decrease)
Percent
Change
$153,357 13% $158,861 14% $(5,504) (3)%
Net revenues from sales of titles for the hand-held platforms decreased 3% from $158.9 million for
the year ended March 31, 2006 to $153.4 million for the year ended March 31, 2007. Hand-held net
revenues as a percentage of publishing net revenues decreased slightly from 14% to 13%. Within the
hand-held platforms, net revenues for the GBA platform decreased 39%, from $79.7 million for the
prior fiscal year, to $48.5 million for fiscal 2007, PSP decreased by 4%, from $52.0 million to $49.9
million, and net revenues for the NDS doubled from $27.1 million for fiscal 2006 to $54.9 million for
Management’s Discussion and Analysis
of Financial Condition and Results of Operations