Activision Blizzard Inc. rallied as much as 10 per cent after giving an upbeat outlook for this year and next, boosted by marquee video-game franchises such as Call of Duty, World of Warcraft and Candy Crush.

Revenue this quarter will be US$1.75 billion, excluding some items, the company said Thursday, compared with the US$1.68 billion predicted by analysts. Its annual forecast also topped estimates, and Activision said 2022 will benefit from a flurry of new game releases. That helped send the shares as high as US$102.19 in premarket trading Friday, which would be a record level in regular trading.

The whole video-game industry has gotten a lift from pandemic-fueled lockdowns over the past year. New consoles -- Sony Corp.’s PlayStation 5 and Microsoft Corp.’s Xbox Series X -- have also bolstered game sales since their release last year.

But the question hanging over Activision was whether that momentum would soon fade. The forecast suggests that’s not the case, said Matt Kanterman, an analyst at Bloomberg Intelligence. Activision was “quite frankly more resilient than expected,” he said.

A steady stream of new content has proven to be Activision’s biggest growth driver, rather than, say, a new console.

“It’s a very simple thing -- it’s really execution, and it was across every new franchise,” Chief Executive Officer Bobby Kotick said in an interview. “It’s very independent of a platform.”

Activision, based in Santa Monica, California, also has benefited from offering more free-to-play options, which attract casual customers.

The company posted US$3.05 billion in revenue in the fourth quarter, excluding some items, while analysts projected US$2.79 billion. Adjusted earnings came in at US$1.21 a share, compared with an average estimate of US$1.17.

Activision forecast adjusted earnings of 65 cents a share in the current quarter, in line with estimates.

The report outshined that of rival Electronic Arts Inc., which missed analysts’ estimates this week with its forecast. The company blamed higher expenses. Next week, Take-Two Interactive Software Inc. and Zynga Inc. are reporting as well.

Both Activision and Electronic Arts tend to give conservative forecasts, Kanterman said, “so Activision’s full year-outlook -- that is already ahead of consensus and may, in fact, still prove conservative -- is being better received by investors.”

Buyback Plan

Activision’s board also increased the dividend 15 per cent to 47 cents a share, payable on May 6. And it embarked on a new two-year stock repurchase program of as much as US$4 billion.

The shares had been little changed this year through the close, following a gain of 56 per cent in 2020.

Activision’s biggest brands are helping it maintain momentum. The mobile edition of Call of Duty launched in China in late December, quickly reaching the top of the download charts. The first stage of regional testing for Diablo Immortal in December and January “was met with very positive feedback and strong engagement metrics,” according to the company, which expects to launch that game this year.

The company is planning to hire as many as 3,000 people this year, mostly in production and development, Kotick said. Activision doesn’t anticipate any delays in delivery of game titles slated for 2021, he said.

Kotick expects employees to work from home until September, and the company will help eligible workers receive vaccines.