Activision Blizzard Inc. (NASDAQ:ATVI)

Total Asset Turnover

The reported total asset turnover ratio declined from 0.42 in 2018 to 0.27 in 2022, reflecting a decreasing efficiency in generating revenue from assets. The adjusted total asset turnover showed a similar downward trend, though less pronounced, declining from 0.39 to 0.32 over the same period. This suggests a gradual reduction in asset utilization effectiveness.

Current Ratio

The reported current ratio increased significantly from 2.31 in 2018 to a peak of 5.21 in 2021 before slightly decreasing to 4.07 in 2022. The adjusted current ratio displayed a similar pattern but at higher absolute values, rising from 5.48 in 2018 to 10.41 in 2021 and slightly declining to 10.11 in 2022. These elevated ratios indicate a strong liquidity position, with substantial current assets relative to current liabilities.

Debt to Equity Ratio

The reported debt to equity ratio remained relatively stable, decreasing slightly from 0.24 in 2018 to 0.19 in 2022. The adjusted debt to equity ratio mirrored this trend, declining modestly from 0.24 to 0.19. This indicates a consistent approach to leverage with a modest reduction in reliance on debt financing.

Debt to Capital Ratio

Both reported and adjusted debt to capital ratios demonstrated minor fluctuations but overall showed a decreasing trend, with the reported ratio moving from 0.19 in 2018 to 0.16 in 2022, and the adjusted ratio from 0.19 to 0.16. This suggests a gradual reduction in the proportion of debt in the company's capital structure.

Financial Leverage

Reported financial leverage decreased from 1.57 in 2018 to 1.42 in 2022, while adjusted financial leverage followed a similar decline from 1.42 to 1.29. This shows a moderate reduction in the extent of capital leveraged by the company over the period.

Net Profit Margin

The reported net profit margin reached its highest point at 30.66% in 2021, after increasing from 24.17% in 2018. However, it fell sharply to 20.1% in 2022. The adjusted net profit margin showed a fluctuating but generally high range, rising to 28.71% in 2020, slightly decreasing to 25.9% in 2021, and maintaining a robust 26.08% in 2022. Overall, profitability remained strong despite some variability.

Return on Equity (ROE)

Reported ROE displayed an initial decline from 15.96% in 2018 to 11.74% in 2019, followed by a rebound to 15.34% in 2021, then dropping significantly to 7.86% in 2022. Adjusted ROE followed a similar pattern, with a decrease from 10.67% in 2018 to 7.24% in 2019, recovery to 15.09% in 2020, and a decline to 10.9% in 2022. This reflects volatility in shareholder returns over the period.

Return on Assets (ROA)

The reported ROA trend mirrored ROE patterns, rising from 10.17% in 2018 to 10.77% in 2021, then falling to 5.53% in 2022. Adjusted ROA exhibited variability, initially declining from 7.53% in 2018 to 5.25% in 2019, peaking at 11.04% in 2020, before settling at 8.46% in 2022. This indicates fluctuating asset profitability with a recent downturn.

The financial data displays several notable trends over the five-year period analyzed. Net revenues experienced fluctuations, beginning with a decline from 7,500 million US dollars in 2018 to 6,489 million in 2019. This was followed by a significant increase to 8,086 million in 2020 and further growth to 8,803 million in 2021. However, net revenues decreased again in 2022 to 7,528 million.

Total assets exhibited a consistent upward trajectory throughout the period, increasing steadily from 17,835 million US dollars in 2018 to 27,383 million in 2022. This growth in total assets suggests sustained investment and expansion of the asset base.

Reported total asset turnover ratios illustrate a general decline. Starting at 0.42 in 2018, the ratio dropped to 0.33 in 2019, followed by slight increases to 0.35 in both 2020 and 2021, before declining again to 0.27 in 2022. This overall decrease indicates a diminishing efficiency in using assets to generate revenues.

Adjusted net revenues follow a similar trend to reported net revenues, with a decrease in 2019, a peak in 2020, a slight reduction in 2021, and a rebound in 2022. Specifically, adjusted net revenues decreased from 7,064 million in 2018 to 6,371 million in 2019, rose to 8,400 million in 2020, dipped to 8,232 million in 2021, and increased to 8,498 million in 2022.

Adjusted total assets also increased consistently, from 17,931 million in 2018 to 26,198 million in 2022, mirroring the growth observed in total assets.

Adjusted total asset turnover ratios reveal a downward trend from 0.39 in 2018 to 0.32 in 2022, with a notable peak at 0.38 in 2020 and a decline thereafter. This pattern similarly suggests decreasing asset utilization efficiency despite the growth in revenues and assets.

In summary, the company expanded its asset base significantly during the period while facing challenges in maintaining proportional revenue growth relative to asset expansion. The asset turnover ratios indicate a trend toward less efficient use of assets to generate revenues, particularly in the most recent years analyzed.

Current Assets Trend

Current assets have shown a consistent upward trajectory over the five-year period, increasing from $6,106 million in 2018 to $14,469 million in 2022. The growth appears to accelerate particularly after 2019, indicating the company has been steadily enhancing its asset base available within a year.

Current Liabilities Trend

Current liabilities have exhibited some fluctuations. Starting at $2,642 million in 2018, there was a moderate increase to $3,100 million by 2020, followed by a decline to $2,411 million in 2021, and then a sharp rise again to $3,555 million in 2022. This inconsistency may reflect changes in short-term obligations or working capital management strategies.

Reported Current Ratio Trend

The reported current ratio has improved significantly, rising from 2.31 in 2018 to a peak of 5.21 in 2021, before slightly decreasing to 4.07 in 2022. Overall, the ratio has strengthened, suggesting improved liquidity and the company's increased ability to cover short-term liabilities with current assets.

Adjusted Current Assets and Liabilities

Adjusted current assets mirror the growth pattern of reported current assets, increasing steadily from $6,292 million in 2018 to $14,485 million in 2022. Adjusted current liabilities, however, declined from $1,149 million in 2018 to $1,208 million in 2021, with a modest increase to $1,433 million in 2022, indicating a tighter control or different classification of liabilities compared to reported figures.

Adjusted Current Ratio Trend

The adjusted current ratio shows a pronounced improvement, moving from 5.48 in 2018 up to a high of 10.41 in 2021 and slightly declining to 10.11 in 2022. These elevated ratios, significantly higher than the reported current ratios, suggest that when adjusted figures are considered, the company has considerably strong liquidity, potentially due to the exclusion of certain liabilities or inclusion of higher quality assets.

Overall Insights

The financial data indicates a strong and improving liquidity position over the five-year period, with current assets increasing substantially. Fluctuations in current liabilities point to some variability in short-term obligations. The adjusted financial metrics provide an even more favorable liquidity assessment, reflecting strategic adjustments in asset or liability classifications. Despite the slight declines in 2022 ratios, the company continues to maintain ample short-term financial flexibility.

Total Debt

The total debt remained relatively stable between 2018 and 2019, with a slight increase from approximately $2.67 billion to $2.68 billion. However, a notable increase occurred in 2020, when the total debt rose to about $3.61 billion, and this level remained essentially unchanged through 2021 and 2022.

Shareholders’ Equity

Shareholders’ equity exhibited a consistent upward trend over the entire period. Starting from approximately $11.36 billion in 2018, it increased steadily each year, reaching about $19.24 billion by the end of 2022. This represents a significant growth in equity, indicating an expansion of the company's net assets over time.

Reported Debt to Equity Ratio

The debt to equity ratio showed a slight downward trend overall. Beginning at 0.24 in 2018, the ratio decreased to 0.21 in 2019, rose slightly back to 0.24 in 2020, but then declined again to 0.21 in 2021 and further to 0.19 by 2022. This suggests a gradual reduction in leverage relative to equity, which could be indicative of a strengthening equity base or controlled debt level relative to equity.

Adjusted Total Debt

The adjusted total debt followed a pattern similar to the reported total debt. It remained relatively stable from 2018 to 2019, increased sharply in 2020, and then plateaued through 2021 and 2022, ending slightly lower in 2022 compared to the previous two years. The peak level of adjusted debt, around $3.9 billion, indicates a higher debt load during 2020 and 2021 before a marginal reduction.

Adjusted Shareholders’ Equity

Adjusted shareholders’ equity demonstrated continuous growth over the period, mirroring the trend in reported equity. Starting from about $12.65 billion in 2018, it increased steadily each year to reach approximately $20.34 billion in 2022. This consistent increase reflects ongoing improvements in the company’s net asset value after adjustments.

Adjusted Debt to Equity Ratio

The adjusted debt to equity ratio displayed a pattern closely aligned with the reported ratio, oscillating slightly but generally trending downward. It started at 0.24 in 2018, dipped to 0.22 in 2019, returned to 0.24 in 2020, then decreased again to 0.22 in 2021 and further down to 0.19 in 2022. This progression indicates a modest reduction in adjusted leverage over time, supporting the observation of strengthened equity relative to debt.

The financial data reveals several important trends regarding the company's debt and capital structure over the five-year period.

Total Debt

Total debt remained relatively stable between 2018 and 2019, increasing slightly from 2671 million to 2675 million US dollars. There was a notable increase in total debt in 2020, rising to 3605 million US dollars, and it then plateaued modestly through 2021 and 2022 at approximately 3608 and 3611 million US dollars respectively.

Total Capital

Total capital demonstrated steady growth throughout the period, increasing consistently each year. Beginning at 14028 million US dollars in 2018, it rose to 15480 million in 2019, then saw a more significant increase in 2020 to 18642 million. The upward trend continued through 2021 and 2022, reaching 21207 and 22854 million US dollars respectively. This reflects ongoing expansion or capital accumulation by the company.

Reported Debt to Capital Ratio

The reported debt to capital ratio showed relative stability with minor fluctuations. The ratio decreased slightly from 0.19 in 2018 to 0.17 in 2019, rose again to 0.19 in 2020, then declined to 0.17 in 2021 and further to 0.16 by the end of 2022. This suggests that while total debt increased in absolute terms, the growth in capital outpaced debt, leading to a lower overall debt burden relative to capital.

Adjusted Total Debt

Adjusted total debt followed a pattern similar to total debt, starting at 2984 million US dollars in 2018 and slightly decreasing to 2948 million in 2019. A significant increase occurred in 2020, jumping to 3895 million, and it remained fairly constant thereafter, with 3897 million in 2021 and a slight decline to 3856 million in 2022.

Adjusted Total Capital

Adjusted total capital consistently increased over the period, starting from 15633 million US dollars in 2018 and rising to 16493 million in 2019. The growth accelerated in 2020 to 19874 million and continued in 2021 and 2022 with values of 21845 million and 24193 million respectively. This demonstrates a continued strengthening of the company’s capital position after adjusting for certain factors.

Adjusted Debt to Capital Ratio

The adjusted debt to capital ratio reflects a similar trend to its reported counterpart, beginning at 0.19 in 2018, slightly increasing to 0.20 in 2020, and then gradually decreasing to 0.16 by 2022. This indicates an improvement in the company’s financial leverage, with its adjusted capital base expanding at a faster rate than its adjusted debt.

Overall, the data shows that despite an increase in absolute debt levels, both reported and adjusted debt to capital ratios have generally declined in recent years. This trend points to a strengthening capital structure and reduced relative leverage, underpinning improved financial stability and potentially greater capacity for investment or risk absorption.

The financial data reveals consistent growth in the asset base and shareholders’ equity over the five-year period. Total assets increased steadily from US$17,835 million at the end of 2018 to US$27,383 million by the end of 2022, representing a cumulative growth of approximately 53%. Shareholders’ equity exhibited a similar upward trend, rising from US$11,357 million to US$19,243 million, indicating a substantial strengthening of the company's equity position.

The reported financial leverage ratio, calculated as the ratio of total assets to shareholders’ equity, showed a slight decline from 1.57 in 2018 to 1.42 in 2022. This decrease suggests a modest reduction in the company's reliance on debt financing relative to equity, implying a cautious approach to leverage and an improving capital structure.

An analysis of adjusted figures, which presumably account for certain reclassifications or valuations, mirrors the general trend observed in the reported figures. Adjusted total assets grew from US$17,931 million in 2018 to US$26,198 million in 2022. Adjusted shareholders’ equity increased correspondingly from US$12,649 million to US$20,337 million over the same period.

The adjusted financial leverage ratio demonstrated a consistent downward trajectory, moving from 1.42 in 2018 to 1.29 in 2022. This trend is indicative of gradually improved financial stability and a decreasing dependency on external financing sources when considering the adjusted balance sheet metrics.

Total Assets

Showed a steady and substantial growth over five years, increasing over 50%, reflecting an expanding asset base.

Shareholders’ Equity

Increased significantly, highlighting the company’s strengthening equity position and possibly improved retained earnings or capital injections.

Reported Financial Leverage

Decreased slightly from 1.57 to 1.42, suggesting reduced leverage and improved capital structure.

Adjusted Total Assets and Equity

Followed similar growth patterns to reported figures with consistent increases, indicating reliability and consistency in financial adjustments made.

Adjusted Financial Leverage

Declined more noticeably than the reported ratio, from 1.42 to 1.29, pointing to a stronger balance sheet when adjusted for specific factors.

Overall, the data indicates a robust growth trajectory in both assets and equity, alongside a gradual deleveraging trend. This combination suggests an improving financial position with enhanced equity support and a moderate reliance on debt financing.

Net Income

The net income exhibited fluctuations over the observed period. It decreased from 1,813 million USD in 2018 to 1,503 million USD in 2019, followed by a significant rise to 2,197 million USD in 2020 and a further increase to 2,699 million USD in 2021. However, in 2022, net income declined sharply to 1,513 million USD, marking a substantial drop from the previous year.

Net Revenues

Net revenues showed a varied trend with an initial decline from 7,500 million USD in 2018 to 6,489 million USD in 2019. This was succeeded by a strong recovery and increase to 8,086 million USD in 2020 and further growth to 8,803 million USD in 2021. In 2022, net revenues decreased again to 7,528 million USD, aligning closely with the 2018 level.

Reported Net Profit Margin

The reported net profit margin generally improved from 24.17% in 2018 to a peak of 30.66% in 2021. However, it declined to 20.1% in 2022, indicating a decreased proportion of profit relative to revenues in the most recent year despite previous gains.

Adjusted Net Income

Adjusted net income decreased from 1,350 million USD in 2018 to 981 million USD in 2019, then experienced a notable increase reaching 2,412 million USD in 2020. It slightly declined to 2,132 million USD in 2021 but increased again to 2,216 million USD in 2022. This suggests improvements in profitability after adjustments, particularly from 2019 onwards, with some volatility.

Adjusted Net Revenues

Adjusted net revenues followed a pattern similar to reported net revenues, decreasing from 7,064 million USD in 2018 to 6,371 million USD in 2019, then rising sharply to 8,400 million USD in 2020. A slight decrease occurred in 2021 to 8,232 million USD, followed by growth to 8,498 million USD in 2022. This indicates overall growth in adjusted revenue over the later years.

Adjusted Net Profit Margin

The adjusted net profit margin showed an initial drop from 19.11% in 2018 to 15.4% in 2019. Subsequently, it increased significantly to 28.71% in 2020, then decreased to 25.9% in 2021 before slightly rising to 26.08% in 2022. This reflects improving efficiency and profitability from 2019, maintaining a relatively high margin in the last three years.

Overall, the financial data reveals a pattern of recovery and growth following a dip in 2019, with peaks in profitability and income achieved around 2020 and 2021. However, the year 2022 showed a decline in reported net income and profit margin while adjusted profitability remained comparatively stable, suggesting some recent challenges or changes affecting reported figures.

Net Income

The net income experienced fluctuations over the evaluation period. It initially declined from 1,813 million USD in 2018 to 1,503 million USD in 2019, followed by a significant increase to 2,197 million USD in 2020 and further growth to 2,699 million USD in 2021. However, there was a notable decrease to 1,513 million USD in 2022. This indicates a peak in profitability around 2020-2021, with a reduction in the most recent year.

Shareholders’ Equity

Shareholders’ equity showed a consistent upward trend throughout the period, increasing steadily from 11,357 million USD in 2018 to 19,243 million USD in 2022. This suggests ongoing capital growth and an accumulation of retained earnings or additional equity contributions over time.

Reported Return on Equity (ROE)

The reported ROE decreased from 15.96% in 2018 to 11.74% in 2019, then improved to 14.61% in 2020 and 15.34% in 2021, indicating an overall recovery and strengthening of profitability relative to shareholders’ equity. In 2022, there was a marked decline to 7.86%, reflecting a sharp reduction in net income relative to equity during that year.

Adjusted Net Income

Adjusted net income showed an initial decline from 1,350 million USD in 2018 to 981 million USD in 2019, sharply rising to 2,412 million USD in 2020. It then slightly declined to 2,132 million USD in 2021 but recovered to 2,216 million USD in 2022. This adjusted measure suggests a more stable profitability trend compared to reported net income, particularly with less pronounced decrease in 2022.

Adjusted Shareholders’ Equity

Similar to reported equity, adjusted shareholders’ equity consistently increased from 12,649 million USD in 2018 to 20,337 million USD in 2022. The difference in magnitude compared to reported equity reflects adjustments applied but does not alter the overall growth trajectory.

Adjusted Return on Equity (ROE)

Adjusted ROE declined sharply from 10.67% in 2018 to 7.24% in 2019, surged to 15.09% in 2020, and decreased again to 11.88% in 2021. In 2022, there was a further decline to 10.9%, still higher than the lowest points but substantially lower than peak values. This pattern suggests that on an adjusted basis, profitability relative to equity also experienced volatility but remained more stable than the reported ROE.

Net Income Trends

Net income experienced fluctuations over the five-year period. It decreased from 1,813 million USD in 2018 to 1,503 million USD in 2019, then rose sharply to 2,197 million USD in 2020. It further increased to a peak of 2,699 million USD in 2021 before declining substantially to 1,513 million USD in 2022. This pattern indicates volatility with a general upward trend until 2021, followed by a notable contraction in the most recent year.

Total Assets Trends

Total assets showed consistent growth throughout the period, increasing steadily from 17,835 million USD in 2018 to 27,383 million USD in 2022. This reflects a continuous asset base expansion with a compound increase indicating investments or acquisitions contributing to company growth.

Reported Return on Assets (ROA) Trends

The reported ROA followed a fluctuating pattern that somewhat mirrors net income changes. It declined from 10.17% in 2018 to 7.57% in 2019, increased in the subsequent years to a high of 10.77% in 2021, and then decreased sharply to 5.53% in 2022. This suggests that asset profitability weakened considerably in the latest year after peaking in 2021.

Adjusted Net Income Trends

Adjusted net income also demonstrated variability. It declined from 1,350 million USD in 2018 to 981 million USD in 2019, then surged to 2,412 million USD in 2020. Subsequent years saw a slight decrease to 2,132 million USD in 2021 followed by a mild recovery to 2,216 million USD in 2022. Adjusted figures appear less volatile than reported net income in the latter years, indicating some smoothing of extraordinary items.

Adjusted Total Assets Trends

Adjusted total assets increased steadily from 17,931 million USD in 2018 to 26,198 million USD in 2022. Growth was consistent, mirroring the trend seen in reported total assets but with slightly different absolute values. This confirms ongoing expansion in asset base from an adjusted perspective.

Adjusted Return on Assets (ROA) Trends

Adjusted ROA declined from 7.53% in 2018 to a low of 5.25% in 2019, then rose markedly to 11.04% in 2020. After this peak, the ratio decreased to 9% in 2021 and further to 8.46% in 2022. Although showing a similar path to reported ROA, adjusted ROA demonstrates less severe deterioration in the most recent year, suggesting better underlying operational profitability when adjustments are considered.

Overall Insights

The financial performance shows a period of volatility with a peak around 2020-2021 followed by a decline in 2022 in terms of net income and ROA, both reported and adjusted. The continuous increase in total assets indicates company growth and investment. However, declining returns on assets in the latest year may indicate challenges in converting expanded asset base into proportional profit. Adjusted measures provide a smoother profitability outlook, implying that extraordinary items impacted reported figures notably.