Activision Blizzard (ATVI)

Microsoft Xbox360 Net Revenues (in thousands)

Net revenues from sales of titles for the Xbox360 increased from $11.8 million and 9% of publishing net revenues in the first quarter of fiscal 2007, to $150.6 million and 35% of publishing net revenues for the first quarter of fiscal 2008.  This significant increase reflects the growth of the installed base since the introduction of the new platform in November 2005, and the success of our fiscal 2008 first quarter title releases, Guitar Hero II for the Xbox360 (game and accessories), Spider-Man 3, Shrek The Third,  and the release in North America and Asia of TRANSFORMERS: The Game.  During the first quarter of fiscal 2007, we launched X-Men: The Official Game and continued to experience strong sales of Call of Duty 2, although limited by hardware availability.

We expect net revenues from sales of titles for the Xbox360 to significantly increase in fiscal 2008 as compared to fiscal 2007 due to the growing installed base and our strong slate of Xbox360 titles.

Microsoft Xbox360 Net Revenues (in thousands)

The Xbox360 was released in November 2005 and was the first of the next-generation hardware to be released. Consistent with our goal of having a significant presence at the launch of each new platform, we released four titles concurrently with the release of the Xbox360, Call of Duty 2, THAW, Quake 4, and GUN. All of these titles were released at premium retail pricing of $59.99. Although limited by hardware availability in fiscal 2006, we experienced strong sales of these four titles, and, according to NPD Funworld, Call of Duty 2 was the number one title on the Xbox360 and had the highest attach rate of any console launch in video game history.

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Microsoft Xbox360 Net Revenues (in thousands)

The Xbox360 was released in November 2005 and was the first of the next-generation hardware to be released.  Consistent with our goal of having a significant presence at the launch of each new platform, we released four titles concurrently with the release of the Xbox360; Call of Duty 2, THAW, Quake 4, and GUN.  In addition, in the first quarter of fiscal 2007 we released our fifth Xbox360 title, X-Men: The Official Game.  All of these titles were released at premium retail pricing of $59.99.  Although limited by hardware availability, during the first quarter of fiscal 2007, we launched X-Men: The Official Game and continued to experience strong sales of Call of Duty 2.  We expect the Xbox360 to provide significant opportunity for us in the upcoming fiscal years.   For the remainder of fiscal 2007, we expect net revenues from sales of titles for the Xbox360 to continue to increase over what we achieved in fiscal 2006.

Microsoft Xbox360 Net Revenues (in thousands)

The Xbox360 was released in November 2005 and was the first of the next-generation hardware to be released.  Consistent with our goal of having a significant presence at the launch of each new platform, we released four titles concurrently with the release of the Xbox360, Call of Duty 2, THAW, Quake 4, and GUN.  All of these titles

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were released at premium retail pricing of $59.99.  Although limited by hardware availability in fiscal 2006, we experienced strong sales of these four titles, and, according to NPD Funworld, Call of Duty 2 was the number one title on the Xbox360 and had the highest attach rate of any console launch in video game history.  We expect the Xbox360 to provide significant opportunity for us in the upcoming fiscal years.   In fiscal 2007, we expect net revenues from sales of titles for the Xbox360 to continue to increase over what we achieved in fiscal 2006.