Blizzard Entertainment Inc.’s first foray into free-to-play video games is turning into a big moneymaker.
“Hearthstone: Heroes of Warcraft,” released in March, is on pace to crack $100 million in revenue in its first year, executives of the Irvine-based company confirmed in a recent conference call with analysts.
And that forecast doesn’t fully capture the potential of Android and iPhone smartphone users, since the game is now only available on PCs, Macs and iPads. The tablet release in April generated millions of new players.
“Hearthstone has been exceeding all of our expectations,” Chief Executive Michael Morhaime said. “We’re very excited about the long-term prospects, especially when you consider further platform expansion to smartphones and a strong multiyear content pipeline that we have planned.”
China consumers, long targeted by Blizzard, are expected to buy more than 500 million smartphones next year alone, according to industry forecasts.
The spinoff card game features characters from the company’s World of Warcraft franchise, by far Blizzard’s largest source of revenue.
Unlike World of Warcraft, however, Hearthstone players aren’t required to pay monthly subscription fees for updated content and can finish a game in 10 minutes rather than logging hours in front of a computer screen, a fairly common phenomenon in the multiplayer fantasy franchise that Blizzard helped usher in a decade ago.
Real Money
That strategy hasn’t stopped Hearthstone’s growing legion of fans from setting up online accounts and spending real money to acquire special card packs that provide new characters and add weapons or accessories, despite the fact that the add-ons can be acquired over time through traditional game play.
Blizzard loyalists last month were introduced to new adventure mode content in Hearthstone that includes single-player challenges and new cards that can be used in head-to-head battles.
The content, dubbed Curse of Naxxramas, is split into five parts released over five weeks, allowing players to purchase it a la carte using in-game cash or real money.
The roll-out fueled Hearthstone’s biggest week in revenue and engagement, while helping Blizzard’s parent, Santa Monica-based Activision Blizzard Inc., rack up $481 million in digital online revenue in the second quarter, up 25.5% from the same period a year ago.
Blizzard posted overall sales of $340 million in the recently ended quarter, up 52% from a year earlier. Operating income topped $145 million, up 142%.
The growth of Hearthstone, which has amassed more than 12 million players, has also been buoyed by big e-sport tournament events around the globe, according to Morhaime.
Blizzard recently announced a yearlong competition that will pit global players in a face-off in November for a $250,000 purse at BlizzCon, the company’s fanfest held at the Anaheim Convention Center.
Subscribers
The strong performance from Hearthstone helped offset a big WoW subscription drop in the second quarter of 800,000 players.
The game, which costs about $40 to buy and $15 a month to play online, is still the largest massively multiplayer online role-playing game in the world, with more than 6.8 million subscribers.
