Operating Segments and Geographic Regions (Tables)

12 Months Ended

Dec. 31, 2018

Segment Reporting [Abstract]

Schedule of operating segments and reconciliations of total net revenues and total segment operating income to consolidated net revenues from external customers and consolidated income before income tax expense

Information on the reportable segment net revenues and segment operating income are presented below (amounts in millions):

	Year Ended December 31, 2018
	Activision		Blizzard		King		Total
Segment Revenues
Net revenues from external customers	$	2,458	$	2,238	$	2,086	$	6,782
Intersegment net revenues (1)	—		53		—		53
Segment net revenues	$	2,458	$	2,291	$	2,086	$	6,835
Segment operating income	$	1,011	$	685	$	750	$	2,446
	Year Ended December 31, 2017
	Activision		Blizzard		King		Total
Segment Revenues
Net revenues from external customers	$	2,628	$	2,120	$	1,998	$	6,746
Intersegment net revenues (1)	—		19		—		19
Segment net revenues	$	2,628	$	2,139	$	1,998	$	6,765
Segment operating income	$	1,005	$	712	$	700	$	2,417
	Year Ended December 31, 2016
	Activision		Blizzard		King		Total
Segment Revenues
Net revenues from external customers	$	2,220	$	2,439	$	1,586	$	6,245
Intersegment net revenues (1)	—		—		—		—
Segment net revenues	$	2,220	$	2,439	$	1,586	$	6,245
Segment operating income	$	788	$	995	$	537	$	2,320

(1) Intersegment revenues reflect licensing and service fees charged between segments.

Reconciliations of total segment net revenues and total segment operating income to consolidated net revenues and consolidated income before income tax expense are presented in the table below (amounts in millions):

	Years Ended December 31,
	2018			2017			2016
Reconciliation to consolidated net revenues:
Segment net revenues	$	6,835		$	6,765		$	6,245
Revenues from other segments (1)	480			410			354
Net effect from recognition (deferral) of deferred net revenues	238			(139		)	9
Elimination of intersegment revenues (2)	(53		)	(19		)	—
Consolidated net revenues	$	7,500		$	7,017		$	6,608
Reconciliation to consolidated income before income tax expense:
Segment operating income	$	2,446		$	2,417		$	2,320
Operating income (loss) from other segments (1)	31			(19		)	14
Net effect from recognition (deferral) of deferred net revenues and related cost of revenues	100			(71		)	(10		)
Share-based compensation expense	(209		)	(178		)	(159		)
Amortization of intangible assets	(370		)	(757		)	(706		)
Fees and other expenses related to the acquisition of King (3)	—			(15		)	(47		)
Restructuring costs (4)	(10		)	(15		)	—
Other non-cash charges (5)	—			(14		)	—
Discrete tax-related items (6)	—			(39		)	—
Consolidated operating income	1,988			1,309			1,412
Interest and other expense (income), net	71			146			214
Loss on extinguishment of debt	40			12			92
Consolidated income before income tax expense	$	1,877		$	1,151		$	1,106

(1) Includes other income and expenses from operating segments managed outside the reportable segments, including our Studios and Distribution businesses. Also includes unallocated corporate income and expenses.

(2) Intersegment revenues reflect licensing and service fees charged between segments.

(3) Reflects fees and other expenses, such as legal, banking, and professional services fees, related to the acquisition of King and associated integration activities, including related debt financings.

(4) Reflects restructuring charges, primarily severance costs.

(5) Reflects a non-cash accounting charge to reclassify certain cumulative translation gains (losses) into earnings due to the substantial liquidation of certain of our foreign entities.

(6) Reflects the impact of other unusual or unique tax-related items and activities.

Schedule of net revenues by distribution channels

Net revenues by distribution channel were as follows (amounts in millions):

	Year Ended December 31, 2018
	Activision			Blizzard			King			Non-reportable segments		Elimination of intersegment revenues (3)			Total
Net revenues by distribution channel:
Digital online channels (1)	$	1,740		$	2,009		$	2,090		$	—	$	(53	)	$	5,786
Retail channels	998			109			—			—		—			1,107
Other (2)	—			148			—			459		—			607
Total consolidated net revenues	$	2,738		$	2,266		$	2,090		$	459	$	(53	)	$	7,500
Change in deferred revenues:
Digital online channels (1)	$	(96	)	$	32		$	(4	)	$	—	$	—		$	(68	)
Retail channels	(184		)	(7		)	—			—		—			(191		)
Other (2)	—			—			—			21		—			21
Total change in deferred revenues	$	(280	)	$	25		$	(4	)	$	21	$	—		$	(238	)
Segment net revenues:
Digital online channels (1)	$	1,644		$	2,041		$	2,086		$	—	$	(53	)	$	5,718
Retail channels	814			102			—			—		—			916
Other (2)	—			148			—			480		—			628
Total segment net revenues	$	2,458		$	2,291		$	2,086		$	480	$	(53	)	$	7,262

Net revenues by distribution channel for the years ended December 31, 2017 and December 31, 2016, were as follows (amounts in millions):

	Years Ended December 31,
	2017		2016
Net revenues by distribution channel:
Digital online channels (1)	$	5,479	$	4,865
Retail channels	1,033		1,386
Other (2)	505		357
Total consolidated net revenues	$	7,017	$	6,608

(1) Net revenues from “Digital online channels” include revenues from digitally-distributed subscriptions, downloadable content, microtransactions, and products, as well as licensing royalties.

(2) Net revenues from “Other” include revenues from our Studios and Distribution businesses, as well as revenues from MLG and the Overwatch League.

(3) Intersegment revenues reflect licensing and service fees charged between segments.

Schedule of net revenues from external customers by geographic region

Net revenues by geographic region, including a reconciliation to each of our reportable segment’s net revenues, for the year ended December 31, 2018, were as follows (amounts in millions):

	Year Ended December 31, 2018
	Activision			Blizzard			King			Non-reportable segments		Elimination of intersegment revenues (2)			Total
Net revenues by geographic region:
Americas	$	1,622		$	1,004		$	1,269		$	13	$	(28	)	$	3,880
EMEA (1)	897			692			599			446		(16		)	2,618
Asia Pacific	219			570			222			—		(9		)	1,002
Total consolidated net revenues	$	2,738		$	2,266		$	2,090		$	459	$	(53	)	$	7,500
Change in deferred revenues:
Americas	$	(163	)	$	15		$	(3	)	$	—	$	—		$	(151	)
EMEA (1)	(127		)	16			(1		)	21		—			(91		)
Asia Pacific	10			(6		)	—			—		—			4
Total change in deferred revenues	$	(280	)	$	25		$	(4	)	$	21	$	—		$	(238	)
Segment net revenues:
Americas	$	1,459		$	1,019		$	1,266		$	13	$	(28	)	$	3,729
EMEA (1)	770			708			598			467		(16		)	2,527
Asia Pacific	229			564			222			—		(9		)	1,006
Total segment net revenues	$	2,458		$	2,291		$	2,086		$	480	$	(53	)	$	7,262

Net revenues by geographic region for the years ended December 31, 2017 and December 31, 2016, were as follows (amounts in millions):

	Years Ended December 31,
	2017		2016
Net revenues by geographic region:
Americas	$	3,607	$	3,423
EMEA (1)	2,464		2,221
Asia Pacific	946		964
Total consolidated net revenues	$	7,017	$	6,608

(1) “EMEA” consists of the Europe, Middle East, and Africa geographic regions.

(2) Intersegment revenues reflect licensing and service fees charged between segments.

Schedule of net revenues by platform

Net revenues by platform, including a reconciliation to each of our reportable segment’s net revenues, for the year ended December 31, 2018, were as follows (amounts in millions):

	Year Ended December 31, 2018
	Activision			Blizzard			King			Non-reportable segments		Elimination of intersegment revenues (3)			Total
Net revenues by platform:
Console	$	2,351		$	187		$	—		$	—	$	—		$	2,538
PC	368			1,711			154			—		(53		)	2,180
Mobile and ancillary (1)	19			220			1,936			—		—			2,175
Other (2)	—			148			—			459		—			607
Total consolidated net revenues	$	2,738		$	2,266		$	2,090		$	459	$	(53	)	$	7,500
Change in deferred revenues:
Console	$	(257	)	$	(8	)	$	—		$	—	$	—		$	(265	)
PC	(23		)	33			(1		)	—		—			9
Mobile and ancillary (1)	—			—			(3		)	—		—			(3		)
Other (2)	—			—			—			21		—			21
Total change in deferred revenues	$	(280	)	$	25		$	(4	)	$	21	$	—		$	(238	)
Segment net revenues:
Console	$	2,094		$	179		$	—		$	—	$	—		$	2,273
PC	345			1,744			153			—		(53		)	2,189
Mobile and ancillary (1)	19			220			1,933			—		—			2,172
Other (2)	—			148			—			480		—			628
Total segment net revenues	$	2,458		$	2,291		$	2,086		$	480	$	(53	)	$	7,262

Net revenues by platform for the years ended December 31, 2017 and December 31, 2016, were as follows (amounts in millions):

	Years Ended December 31,
	2017		2016
Net revenues by platform:
Console	$	2,389	$	2,453
PC	2,042		2,124
Mobile and ancillary (1)	2,081		1,674
Other (2)	505		357
Total consolidated net revenues	$	7,017	$	6,608

(1) Net revenues from “Mobile and ancillary” include revenues from mobile devices, as well as non-platform specific game-related revenues, such as standalone sales of toys and accessories from our Skylanders^® franchise and other physical merchandise and accessories.

(2) Net revenues from “Other” include revenues from our Studios and Distribution businesses, as well as revenues from MLG and the Overwatch League.

(3) Intersegment revenues reflect licensing and service fees charged between segments.

Long-lived assets by geographic region

Long-lived assets by geographic region were as follows (amounts in millions):

	At December 31,
	2018		2017		2016
Long-lived assets* by geographic region:
Americas	$	203	$	197	$	154
EMEA	62		75		87
Asia Pacific	17		22		17
Total long-lived assets by geographic region	$	282	$	294	$	258

* The only long-lived assets that we classify by region are our long-term tangible fixed assets, which consist of property, plant, and equipment assets; all other long-term assets are not allocated by location.