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Mathias Holmstrøm

 
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  • Activision Blizzard: Why Earnings Will Decline [View article]
    Subscriber figures down 500k from last quarter.
    Feb 7 07:12 PM | 1 Like Like |Link to Comment
  • Activision Blizzard: Why Earnings Will Decline [View article]
    Hey Mr_Stockt;

    While I believe Blizzard is poorly managed, I don't think Activision is. In fact, I believe Blizzard could learn a lot from Activision with regards to designing proper business model's to maximize shareholder value.

    It's a myth that Diablo 3 was a failure/Sc2 "semifailure" because of the Activision merger. The games were failure due to incompetent employees designing the games. The developers have had all the time in the world to develop these games and there is very little similarity between how D3 and Sc2 works compared to how CoD/skylander's etc. works, which makes me convinced that any Activision impact has been minimal.
    Feb 7 07:11 PM | Likes Like |Link to Comment
  • Activision Blizzard: Why Earnings Will Decline [View article]
    I see your point now with regards to advertising. That is definitely correct. But as you also say the effect of the advertising is limited as the target group from tournmanets is mostly players which already play the game.
    Feb 7 07:06 PM | Likes Like |Link to Comment
  • How Much Is Apple Worth? [View article]
    I think you misunderstand ny intention behind the assumption. I also think that apple will release a tv, however it would be top complicated to include that into my valuation model. Indstead graders can add their estimated value of the on top of my fair price estimate.
    Feb 7 04:54 AM | Likes Like |Link to Comment
  • How Much Is Apple Worth? [View article]
    It is bringing interest earnings. And it can still be paid out as dividende or buybacks at some point in the future. I do agree with you that the cash should be valued at a discount which will reduce my fair value estimate
    Feb 7 04:45 AM | Likes Like |Link to Comment
  • Why Apple's Margins Will Continue To Decline [View article]
    Hey croatkid: they are based on my expectations of lower margins. Hopefully my next article will make it a bit easier to see how i got to that conclusion
    Feb 4 02:23 PM | Likes Like |Link to Comment
  • Why Apple's Margins Will Continue To Decline [View article]
    hey solar:According to the court case filings between apple and Samsung ipad margins are in the low twenties
    Feb 4 02:20 PM | Likes Like |Link to Comment
  • Why Apple's Margins Will Continue To Decline [View article]
    Krichard: every valuation is based om assumptions about the future. I do understand that you probably would like a fair value estimate og apple, and i do in fact plan to follow this article up with a dcf valuation
    Feb 4 02:16 PM | Likes Like |Link to Comment
  • Is Nokia Really Undervalued? [View article]
    Showmethemoney: One way to get a sense of the risk of the investment is to look at the beta of the company. Nokia's is around 1.76, which is pretty high (1 is average). There is no doubt in my mind that Nokia is still a high risk company (even though last quarter reduced the risk a bit).

    But why do you think Nokia should be deemed a highgrowth company? Do you think Lumia sales of 8+M per quarter is likely within 1-2 years?
    Feb 4 01:26 PM | Likes Like |Link to Comment
  • Activision Blizzard: Why Earnings Will Decline [View article]
    Ryan. Your argument applies that the potential is unlimited due to the friend-theory, and that World of Warcraft could have done even better.
    I disagree, and I think it will be very difficult for any game, no matter how great it is, to ever get 10+M subscribers, especially since the F2P games has become a lot more popular, and the MOBA genre seems stronger than ever.

    The mean-reversion concept also applies, it just depends on how you interpret it.

    I don't think Destiny should be refered to as Call of Duty's successor. But Bungie definitely has done very well with Halo, but I think it's a bit too early to assume that this will have a signifcant impact on Shareholder value, as I don't think there are any free lunches.
    Jan 31 06:18 PM | Likes Like |Link to Comment
  • Activision Blizzard: Why Earnings Will Decline [View article]
    Filaw: What exactly can ATVI monetize?

    If we look at the Activision franchises, they are monetizing there ass's off (and rightly so), but that also mean that any further potential is limited.

    The Blizzard side, however, has a lot more potential left, but management has shown unwillingness to monetize Starcraft, and now it is too late, as the player base is too small today. Diablo 3 is monetized by Auction House, but the player base is probably relatively small as well, and I doubt there is any more potential in that franchise.
    Jan 31 04:22 PM | Likes Like |Link to Comment
  • Activision Blizzard: Why Earnings Will Decline [View article]
    Dequis: How do you explain the significant decline in subscriber figures from 2011-2012 Q3?
    Jan 31 04:20 PM | 1 Like Like |Link to Comment
  • Activision Blizzard: Why Earnings Will Decline [View article]
    Pavel: Starcraft had a lot of momentum when it was released but "only" sold 6M copies. Today, there is very little mainstream hype revolving Starcraft, and I estimates sales of 2M copies for Q1, and maybe 1M copy in the next quarter.
    I am not forgetting anything. My model has sales estimates for every single game, and I spend a lot of time reflecting upon the optimal gross margins/sales figures/OPEX numbers etc.

    Blizzard doesn't receive advertising from Sc2. They have very inefficient monetization as they only take a small fee from some of the largest tournaments. If you are thinking about stuff like Blizzard's Worlds Champions, it's highly unlikely that they earn any noticeable profit by that, as most tournament organizers break even, and I don't think Blizzard is much more efficient at making tournaments.

    Regarding WOW expansion pack. I didn't directly mention it, as it kinda complicates stuff a lot, and I want to make my articles somewhat simplistic. I agree that it is possible that we will see another expansion pack as well, but likely it will overlap with Titan's expected release in 2014 which means either one of two things;

    1) Titan gets delayed (2015+ --> Lower Shareholder value
    2) Either WOW or Titan doesn't do particular well as they cannibalize each other. --> Lower shareholder value.

    No matter what happens, it doesn't have a significant impact on the future income of Blizzard. Therefore I didn't find it relevant enough to mention it directly in my article.

    History is irrelevant here as there are many other explanations for that. In the future, the most likely outcome is that earnings will decline.
    Jan 31 03:50 PM | Likes Like |Link to Comment
  • Why World Of Warcraft Will Drag Activision Blizzard's Earnings Down [View article]
    Well the average is an estimate baser on the fact that i expect subscribers to have continued declining in august and September until mop was released
    Nov 20 11:36 AM | Likes Like |Link to Comment
  • Why World Of Warcraft Will Drag Activision Blizzard's Earnings Down [View article]
    "Can you elaborate on your methodology for calculating average subscribers?"

    If there are 10M subscribers for 1 month in a quarter, and 8M subscribers for 2 months in the same quarter. Average subscriber = 8.67.
    Nov 17 11:10 AM | Likes Like |Link to Comment
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