Activision Pulls Guitar Hero - Activision Blizzard Inc's first-quarter outlook missed Wall Street expectations and it said it would disband the unit that makes Guitar Hero music games, sending its shares down 8 percent.
The company forecast revenue of $640 million in the first quarter of 2011 and EPS of 7 cents per share, compared with the $734.70 million analysts were expecting on 10 cents per share for the quarter.
"Guidance for 2011 was very disappointing," said MKM Partners analyst Eric Handler.
The company's shares fell to $10.81 in after-hours trading compared with a regular-session close of $11.69.
Activision Blizzard said it would disband its Guitar Hero business unit and stop development of the Guitar Hero game for 2011 because music-themed video games have been fading in popularity. In December, Viacom Inc sold Harmonix Music Systems, the developer behind the Rock Band franchise, to the investment firm Columbus Nova and gained up to $200 million in the deal, analysts have estimated.
Activision Pulls Guitar Hero