Vivendi SA said Tuesday that net profit rose 21 percent in the first quarter thanks to strong earnings at its Santa Monica, Calif.-based Activision Blizzard unit and the integration of newly acquired Brazilian telecom operator GVT.
Activision Blizzard, the video game producer behind titles such as "Call of Duty" and "World of Warcraft," said last week that it earned $381 million, in the January-March quarter, up from $189 million a year earlier.
The unit has been able to weather the economic downturn better than other video game makers because of "Call of Duty" — launched in November last year and the No. 1 title overall in the U.S. and Europe in the first quarter according to Vivendi — and because it can rely on revenue from more than 11.5 million "World of Warcraft" players who pay monthly subscriber fees to play the game online.
The French media and entertainment giant said that profit in the January to March period rose to 598 million euros ($759.34 million) from 493 million euros a year earlier.
Vivendi's underlying profit, which excludes most nonrecurring and non-operating items and is the measure watched most closely by financial analysts, rose 13.4 percent in the quarter to 736 million euros.
Revenue was 6 percent higher at 6.9 billion euros.
Results at GVT, the Brazilian telecommunications company Vivendi bought last year for 2.8 billion euros, have been included since November.
Vivendi said GVT revenues were 214 million euros, a 37 percent increase according to Brazilian accounting standards from a year earlier. With the rise in Brazilian real, the increase in euro amounts to 70 percent.
Vivendi also owns the world's largest music company, Universal Music Group, pay television service Canal Plus, and SFR, the French mobile telecommunications operator.
Universal Music Group, the label behind acts such as Black Eyed Peas, Taylor Swift and Lady Gaga, reported a 13.4 percent decline in revenue to 889 million euros in the quarter. Vivendi blamed "fewer major local and international releases and reduced demand for physical product."
SFR reported a 1.9 percent increase in first quarter revenue to 3.09 billion euros.
Vivendi maintained its full year guidance. It expects a slight increase in core profitability, or EBITA.
Shares fell 1.2 percent to close at 17.91 euros in Paris trading on Tuesday.
Chief Financial Officer Philippe Capron said on a conference call that a U.S. class action suit brought by shareholders will "continue to be a long drawn-out process" and there is "nothing new on that front."
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