SANTA MONICA, Calif.--(BUSINESS WIRE)--Activision Blizzard, Inc. (Nasdaq: ATVI) today announced better-than-expected financial results for the second quarter of 2015.

Second Quarter (in millions, except EPS) 2015 Prior Outlook* 2014 GAAP Net Revenues $ 1,044 $ 930 $ 970 EPS $ 0.29 $ 0.21 $ 0.28 Non-GAAP Net Revenues $ 759 $ 650 $ 658 EPS $ 0.13 $ 0.07 $ 0.06

*Prior outlook was provided by the company on May 6, 2015 in its earnings release.

For the quarter ended June 30, 2015, Activision Blizzard’s GAAP net revenues were $1.04 billion, as compared with $970 million for the second quarter of 2014. On a non-GAAP basis, the company’s net revenues were $759 million, as compared with $658 million for the second quarter of 2014. For the second quarter, GAAP net revenues from digital channels were a Q2 record $569 million and represented a Q2 record 55% of the company’s total revenues. On a non-GAAP basis, net revenues from digital channels were a Q2 record $611 million, growing 27% year-over-year.

For the quarter ended June 30, 2015, Activision Blizzard’s GAAP earnings per diluted share were $0.29, as compared with $0.28 for the second quarter of 2014. On a non-GAAP basis, the company’s earnings per diluted share were $0.13, as compared with $0.06 for the second quarter of 2014.

Year-to-date non-GAAP revenues and EPS were up 2% and 12%, respectively, year-over-year (13% and 56%, respectively, at constant FXA), given strong engagement and recurring digital monetization trends on our year-round monetizing franchises.

Please refer to the tables at the back of this press release for a reconciliation of the company’s GAAP and non-GAAP results.

Bobby Kotick, Chief Executive Officer of Activision Blizzard, said, “Our strategic focus on expanding our franchise portfolio with captivating and original new intellectual property, innovating on new platforms, and expanding into new geographies is reflected in our results. We outperformed our Q2 targets and last year’s results on revenues, digital growth, and earnings per share. These strong results and the excitement for our future games have driven us to raise our full-year outlook.”

Kotick added, “Our audience size and the total amount of time people spend with our franchises continue to grow. In the second quarter, our monthly active usersB grew by 35% year-over-year, and the time our communities spent playing our games grew by 25% year-over-year.”

Kotick continued, “I want to thank our extraordinarily talented employees around the world. They pour their passions into creating the most fun and epic entertainment experiences for our audiences, and our superior financial performance is a result of their dedication.”

Selected Business Highlights:

Blizzard Entertainment’s Hearthstone ® : Heroes of Warcraft™ and Heroes of the Storm ™ , and Activision Publishing’s Destiny combined now have more than 70 million registered players and over $1.25 billion in non-GAAP revenues 1 life-to-date.

and , and Activision Publishing’s combined now have more than 70 million registered players and over $1.25 billion in non-GAAP revenues life-to-date. Activision Publishing had its strongest ever second quarter engagement and digital monetization, with the most Q2 monthly active users (MAUs) B in its history, up more than 25% year-over-year, and the largest Q2 and first half digital revenues in its history.

in its history, up more than 25% year-over-year, and the largest Q2 and first half digital revenues in its history. Activision Publishing continues to have 2 of the top 5 videogame franchises in North America and Europe year-to-date, with Skylanders, including toys and accessories, achieving the No. 1 spot. 2 Including toys and accessories, Skylanders was the No. 1 console title and kids console title year to date, and outsold the No. 1 action figure line in North America and Europe. 2 Activision Publishing also continues to have 3 of the top 5 next-generation games life-to-date. 3

including toys and accessories, achieving the No. 1 spot. Including toys and accessories, was the No. 1 console title and kids console title year to date, and outsold the No. 1 action figure line in North America and Europe. Activision Publishing also continues to have 3 of the top 5 next-generation games life-to-date. Activision Publishing’s Call of Duty franchise Q2 non-GAAP revenues increased by a double-digit percentage year-over-year due to strong continued sell-through of Call of Duty: Advanced Warfare and growing online revenues per user across the franchise. Season pass, downloadable content, and micro-transaction offerings have helped drive increased engagement and monetization. Call of Duty: Advanced Warfare remains the No. 1 next generation game life to date, as it has been since its launch nine months ago. 3

franchise Q2 non-GAAP revenues increased by a double-digit percentage year-over-year due to strong continued sell-through of and growing online revenues per user across the franchise. Season pass, downloadable content, and micro-transaction offerings have helped drive increased engagement and monetization. remains the No. 1 next generation game life to date, as it has been since its launch nine months ago. Activision Publishing and Bungie released Destiny ’s highly acclaimed second expansion, House of Wolves , which had a strong attach rate and engagement. Destiny now has over 2 billion hours of gameplay since launch, which amounts to an average 100 hours of gameplay for each of Destiny ’s over 20 million registered players.

released ’s highly acclaimed second expansion, , which had a strong attach rate and engagement. now has over 2 billion hours of gameplay since launch, which amounts to an average 100 hours of gameplay for each of ’s over 20 million registered players. Blizzard Entertainment had the largest online player community in its history, with Q2 MAUs B up 50% year-over-year. Though World of Warcraft ® ended the quarter at 5.6 million subscribers C , Blizzard revenues are up year-over-year based on strong performance across the expanding Blizzard portfolio. On June 23, 2015, Blizzard Entertainment released, Fury of Hellfire , one of the largest non-expansion content updates to date for World of Warcraft . This new content helped stabilize the subscriber number towards the end of the quarter. World of Warcraft remains the No. 1 subscription‐based MMORPG in the world.

up 50% year-over-year. Though ended the quarter at 5.6 million subscribers , Blizzard revenues are up year-over-year based on strong performance across the expanding Blizzard portfolio. On June 23, 2015, Blizzard Entertainment released, , one of the largest non-expansion content updates to date for This new content helped stabilize the subscriber number towards the end of the quarter. World of Warcraft remains the No. 1 subscription‐based MMORPG in the world. On April 2, 2015, Blizzard Entertainment launched Blackrock Mountain ™, the second Adventure for Hearthstone: Heroes of Warcraft . The release of Hearthstone on iOS and Android smartphones followed on April 14, 2015. Key engagement metrics, which were already very strong, nearly doubled year over year, largely on account of the new content and new platforms.

™, the second Adventure for . The release of on iOS and Android smartphones followed on April 14, 2015. Key engagement metrics, which were already very strong, nearly doubled year over year, largely on account of the new content and new platforms. Blizzard Entertainment launched Heroes of the Storm on June 2, 2015 with strong critical reception. The Eternal Conflict, a series of content additions based on the Diablo® universe, was launched in June and is still ongoing, and players have responded with positivity and excitement. Blizzard announced in May that Heroes of the Storm had been added to the Road to BlizzCon ® program, and major tournaments are already underway globally.

on June 2, 2015 with strong critical reception. The Eternal Conflict, a series of content additions based on the universe, was launched in June and is still ongoing, and players have responded with positivity and excitement. Blizzard announced in May that had been added to the Road to BlizzCon program, and major tournaments are already underway globally. On April 23, 2015, Sanctuary’s gates were thrown open to all Chinese heroes, as Blizzard Entertainmentʹs award‐winning action role‐playing game Diablo® III: Reaper of Souls™ went live in China. Diablo III has now sold-through over 30 million units life-to-date globally.

Sanctuary’s gates were thrown open to all Chinese heroes, as Blizzard Entertainmentʹs award‐winning action role‐playing game went live in China. has now sold-through over 30 million units life-to-date globally. Blizzard Entertainment achieved record revenues and MAUsB in China this quarter, driven by the popularity of Diablo III, Hearthstone: Heroes of Warcraft, and Heroes of the Storm.

Company Outlook:

On September 15, 2015, Activision Publishing and Bungie expect to release The Taken King , the largest update to the Destiny universe yet. The mega-expansion will include an all-new campaign, new sub-classes, a new destination, and more. Current players can digitally purchase the expansion for a suggested retail price of $39.99, while The Legendary Edition offers new players the original game, both expansion packs, and The Taken King for a suggested retail price of $59.99.

, the largest update to the universe yet. The mega-expansion will include an all-new campaign, new sub-classes, a new destination, and more. Current players can digitally purchase the expansion for a suggested retail price of $39.99, while The Legendary Edition offers new players the original game, both expansion packs, and for a suggested retail price of $59.99. On September 20, 2015, Activision Publishing expects to release Skylanders SuperChargers, the next installment in the franchise with all new vehicles, action figures and exclusive Nintendo characters.

the next installment in the franchise with all new vehicles, action figures and exclusive Nintendo characters. On October 20, 2015, Activision Publishing plans to bring back the pop culture phenomenon that previously reached over 40 million players in North America and Europe with the launch of Guitar Hero ® Live . The new multiplayer mode, Guitar Hero TV, allows fans to play songs on multiple channels, play with and against their friends, discover new music, and choose songs on-demand. The re-imagined experience will offer two game modes and will be available on consoles, tablets, and mobile phones.

. The new multiplayer mode, Guitar Hero TV, allows fans to play songs on multiple channels, play with and against their friends, discover new music, and choose songs on-demand. The re-imagined experience will offer two game modes and will be available on consoles, tablets, and mobile phones. On November 6, 2015, Activision Publishing expects to release the highly anticipated Call of Duty: Black Ops III from its award winning studio, Treyarch. The company also announced an upcoming multiplayer Beta, a first for Call of Duty on next-generation consoles. Fans who pre-order the game now will get access to the Beta on August 19 on Sony’s PlayStation®4, and August 26 on Microsoft’s Xbox One and PC .

from its award winning studio, Treyarch. The company also announced an upcoming multiplayer Beta, a first for on next-generation consoles. Fans who pre-order the game now will get access to the Beta on August 19 on Sony’s PlayStation®4, and August 26 on Microsoft’s Xbox One and PC . On July 15, 2015, Blizzard Entertainment kicked off pre-purchases for StarCraft ® II: Legacy of the Void ™ , the third installment of the company’s real-time strategy sequel. Players who pre-purchase Legacy of the Void through Battle.net ® will have access to the ongoing beta and three prologue missions, titled “Whispers of Oblivion.” Legacy of the Void will be a standalone product that won’t require any prior releases, so it will be easier than ever for players to get into the game and experience all of the latest content. It is expected to be released in 2015.

, the third installment of the company’s real-time strategy sequel. Players who pre-purchase through Battle.net will have access to the ongoing beta and three prologue missions, titled “Whispers of Oblivion.” will be a standalone product that won’t require any prior releases, so it will be easier than ever for players to get into the game and experience all of the latest content. It is expected to be released in 2015. On July 22, 2015, Blizzard Entertainment announced The Grand Tournament , the second expansion to Hearthstone: Heroes of Warcraft , which will launch with over 130 new cards and new mechanics this month.

, the second expansion to , which will launch with over 130 new cards and new mechanics this month. A new expansion for Blizzard Entertainment’s World of Warcraft will be announced at gamescom in August 2015.

will be announced at gamescom in August 2015. Blizzard Entertainment expects to begin beta testing for Overwatch ™ in fall 2015 .

™ in fall 2015 Tickets to Blizzard Entertainment’s ninth BlizzCon, which will be returning to the Anaheim Convention Center on Friday, November 6, and Saturday, November 7, went on sale in two batches in April and quickly sold out. One of the biggest attractions at BlizzCon will be the culmination of this year’s Road to BlizzCon eSports tournaments, with the global champions for World of Warcraft , StarCraft II , Hearthstone , and Heroes of the Storm being crowned.

, , , and being crowned. Given the weakening of foreign currencies versus the U.S. dollar, the company’s 2015 international revenues and earnings are expected to be translated at lower rates than in 2014. This impacts the company’s 2015 outlook as compared to 2014 actual results because approximately 50% of the company’s revenues, and a higher percentage of profits, are generated outside the U.S. while a much higher percentage of the company’s costs are incurred in the U.S. See comparison table, below.

Activision Blizzard’s third quarter and calendar year 2015 outlook is, as follows:

Prior Outlook* Current Outlook (in millions, except EPS) GAAP Outlook Non-GAAP Outlook GAAP Outlook Non-GAAP Outlook CY 2015 Net Revenues $ 4,250 $ 4,425 $ 4,425 $ 4,600 EPS $ 0.98 $ 1.20 $ 1.06 $ 1.30 Fully Diluted Shares** 750 750 750 750 Q3 2015 Net Revenues N/A N/A $ 875 $ 930 EPS N/A N/A $ 0.08 $ 0.14 Fully Diluted Shares** N/A N/A 748 748

The following table compares our CY14 actual earnings per share to CY15 outlook earnings per share.

Comparison EPS Prior Non-GAAP Outlook* Current Non-GAAP Outlook Change CY14 – Actuals $ 1.42 $ 1.42 Slate / Operations 0.01 0.15 0.14 Foreign Currency (0.15 ) (0.19 ) (0.04 ) Tax Rate & Share Count (0.08 ) (0.08 ) CY15 – Outlook $ 1.20 $ 1.30 0.10

Currency Assumptions for 2015 Outlook (Q3-Q4):

$1.10 USD/Euro for current outlook (vs. $1.11 for prior outlook* and a $1.33 average for 2014)

$1.54 USD/British Pound Sterling for current and prior outlook* (vs. a $1.65 average for 2014)

Note: Revenue and EPS increase if the Euro or British Pound Sterling strengthen vs. USD

* Prior outlook was provided by the company on May 6, 2015 in its earnings release.

** Fully diluted weighted average shares include participating securities and dilutive options on a weighted average basis.

Cash Dividend

Activision Blizzard paid a cash dividend of $0.23 per common share, a 15% increase year-over-year, in May 2015 to shareholders of record at the close of business on March 30, 2015, totaling $170 million. The company did not make any share repurchases during the second quarter under its $750 million share repurchase authorization ending February 2017.

Conference Call

Today at 4:30 p.m. EDT, Activision Blizzard’s management will host a conference call and Webcast to discuss the company’s results for the quarter ended June 30, 2015 and management’s outlook for the remainder of the calendar year. The company welcomes all members of the financial and media communities and other interested parties to visit the “Investor Relations” area of www.activisionblizzard.com to listen to the conference call via live Webcast or to listen to the call live by dialing into 888-337-8197 in the U.S. with passcode 6151996.

About Activision Blizzard

Activision Blizzard, Inc. is the largest and most profitable western interactive entertainment publishing company. It develops and publishes some of the most successful and beloved entertainment franchises in any medium, including Call of Duty, Call of Duty Online, Destiny, Skylanders, World of Warcraft, StarCraft, Diablo, Hearthstone: Heroes of Warcraft, and Heroes of the Storm. The company is one of the FORTUNE “100 Best Companies To Work For®” 2015.

Headquartered in Santa Monica, California, it maintains operations throughout the United States, Europe, and Asia. Activision Blizzard develops and publishes games on all leading interactive platforms and its games are available in most countries around the world. More information about Activision Blizzard and its products can be found on the company's website, www.activisionblizzard.com.

1 Life to date, combined GAAP revenues from Hearthstone: Heroes of Warcraft, Destiny, and Heroes of the Storm were over $1 billion.

2 The NPD Group and GfK Chart-Track and Activision Blizzard internal estimates, including toys and accessories

3 The NPD Group and GfK Chart-Track

A Constant FX Definition: Constant FX provides current period results converted into USD using the average exchange rates from the comparative prior periods rather than the actual exchange rates in effect during the respective current periods.

B Monthly Active User (MAU) Definition: We monitor MAUs as a key measure of the overall size of our user base and their regular engagement with our portfolio of games. MAUs are the number of individuals who played a particular game in a given month. We calculate average MAUs in a period by adding the total number of MAUs in each of the months in a given period and dividing by the number of months in the period. An individual who plays two of our games would be counted as two users. For Activision Publishing MAUs, an individual who plays the same game on two platforms or devices in the relevant period would be counted as two users due to technical limitations. For Blizzard MAUs, an individual who plays the same game on two platforms or devices in the relevant period would be counted as one user.

C Subscriber Definition: World of Warcraft subscribers include individuals who have paid a subscription fee or have an active prepaid card to play World of Warcraft, as well as those who have purchased the game and are within their free month of access. Internet Game Room players who have accessed the game over the last thirty days are also counted as subscribers. The above definition excludes all players under free promotional subscriptions, expired or cancelled subscriptions, and expired prepaid cards. Subscribers in licensees' territories are defined along the same rules.

Non-GAAP Financial Measures: As a supplement to our financial measures presented in accordance with Generally Accepted Accounting Principles (“GAAP”), Activision Blizzard presents certain non-GAAP measures of financial performance. These non-GAAP financial measures are not intended to be considered in isolation from, as a substitute for, or as more important than, the financial information prepared and presented in accordance with GAAP. In addition, these non-GAAP measures have limitations in that they do not reflect all of the items associated with the company’s results of operations as determined in accordance with GAAP.

Activision Blizzard provides net revenues, net income (loss), earnings (loss) per share and operating margin data and guidance both including (in accordance with GAAP) and excluding (non-GAAP) certain items. When relevant, the Company also provides constant FX information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. In addition, Activision Blizzard provides EBITDA (defined as GAAP net income (loss) before interest (income) expense, income taxes, depreciation and amortization) and adjusted EBITDA (defined as non-GAAP operating margin (see non-GAAP financial measure below) before depreciation). The non-GAAP financial measures exclude the following items, as applicable in any given reporting period:

the change in deferred revenues and related cost of sales with respect to certain of the company’s online-enabled games;

expenses related to stock-based compensation;

the amortization of intangibles from purchase price accounting;

fees and other expenses (including legal fees, costs, expenses and accruals) related to the acquisition of 429 million shares of our common stock on October 11, 2013 from Vivendi, pursuant to the stock purchase agreement dated July 25, 2013 and the $4.75 billion debt financings related thereto; and

the income tax adjustments associated with any of the above items.

In the future, Activision Blizzard may also consider whether other significant non-recurring items should also be excluded in calculating the non-GAAP financial measures used by the company. Management believes that the presentation of these non-GAAP financial measures provides investors with additional useful information to measure Activision Blizzard’s financial and operating performance. In particular, the measures facilitate comparison of operating performance between periods and help investors to better understand the operating results of Activision Blizzard by excluding certain items that may not be indicative of the company’s core business, operating results or future outlook. Internally, management uses these non-GAAP financial measures in assessing the company’s operating results, and measuring compliance with the requirements of the company’s debt financing agreements, as well as in planning and forecasting.

Activision Blizzard’s non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles, and the terms non-GAAP net revenues, non-GAAP net income, non-GAAP earnings per share, non-GAAP operating margin, and non-GAAP or adjusted EBITDA do not have a standardized meaning. Therefore, other companies may use the same or similarly named measures, but exclude different items, which may not provide investors a comparable view of Activision Blizzard’s performance in relation to other companies.

Management compensates for the limitations resulting from the exclusion of these items by considering the impact of the items separately and by considering Activision Blizzard’s GAAP, as well as non-GAAP, results and outlook, and by presenting the most comparable GAAP measures directly ahead of non-GAAP measures, and by providing a reconciliation that indicates and describes the adjustments made.

In addition to the reasons stated above, which are generally applicable to each of the items Activision Blizzard excludes from its non-GAAP financial measures, there are additional specific reasons why the company believes it is appropriate to exclude the change in deferred revenues and related cost of sales with respect to certain of the company’s online-enabled games.

Since Activision Blizzard has determined that some of our games’ online functionality represents an essential component of gameplay and, as a result, a more-than-inconsequential separate deliverable, we recognize revenues attributed to these game titles over their estimated service periods, which may range from five months to a maximum of less than a year. The related cost of sales is deferred and recognized as the related revenues are recognized. Internally, management excludes the impact of this change in deferred revenues and related cost of sales in its non-GAAP financial measures when evaluating the company’s operating performance, when planning, forecasting and analyzing future periods, and when assessing the performance of its management team. Management believes this is appropriate because doing so enables an analysis of performance based on the timing of actual transactions with our customers, which is consistent with the way the company is measured by investment analysts and industry data sources. In addition, excluding the change in deferred revenues and the related cost of sales provides a much more timely indication of trends in our operating results.

Cautionary Note Regarding Forward-looking Statements: The statements contained in this press release that are not historical facts are forward-looking statements, including, but not limited to, statements about (1) projections of revenues, expenses, income or loss, earnings or loss per share, cash flow or other financial items; (2) statements of our plans and objectives, including those related to product releases; (3) statements of future financial or operating performance; and (4) statements of assumptions underlying such statements. The company generally uses words such as “outlook,” “forecast,” “will,” “could,” “should,” “would,” “to be,” “plan,” “plans,” “believes,” “may,” “might,” “expects,” “intends,” “intends as,” “anticipates,” “estimate,” “future,” “positioned,” “potential,” “project,” “remain,” “scheduled,” “set to,” “subject to,” “upcoming” and other similar expressions to help identify forward-looking statements. Forward-looking statements are subject to business and economic risk, reflect management’s current expectations, estimates and projections about our business, and are inherently uncertain and difficult to predict.

The Company cautions that a number of important factors could cause Activision Blizzard's actual future results and other future circumstances to differ materially from those expressed in any forward looking statements. Such factors include, but are not limited to: sales levels of Activision Blizzard’s titles; increasing concentration of revenue among a small number of titles; Activision Blizzard’s ability to predict consumer preferences, including interest in specific genres, and preferences among hardware platforms; the amount of our debt and the limitations imposed by the covenants in the agreements governing our debt; adoption rate and availability of new hardware (including peripherals) and related software, particularly during the console transitions; counterparty risks relating to customers, licensees, licensors and manufacturers; maintenance of relationships with key personnel, customers, financing providers, licensees, licensors, manufacturers, vendors, and third-party developers, including the ability to attract, retain and develop key personnel and developers that can create high quality titles; changing business models, including digital delivery of content and the increased prevalence of free-to-play games; product delays or defects; competition, including from used games and other forms of entertainment; rapid changes in technology and industry standards; possible declines in software pricing; product returns and price protection; the identification of suitable future acquisition opportunities and potential challenges associated with geographic expansion; the seasonal and cyclical nature of the interactive entertainment market; litigation risks and associated costs; protection of proprietary rights; shifts in consumer spending trends; capital market risks; applicable regulations; domestic and international economic, financial and political conditions and policies; tax rates and foreign exchange rates; the impact of the current macroeconomic environment; and the other factors identified in “Risk Factors” included in Part I, Item 1A of Activision Blizzard’s most recent annual report on Form 10-K.

The forward-looking statements in this presentation are based on information available to the Company as of the date of this press release and, while believed to be true when made, may ultimately prove to be incorrect. The Company may change its intention, belief or expectation, at any time and without notice, based upon any changes in such factors, in the Company’s assumptions or otherwise. The Company undertakes no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the original date of this press release, August 4, 2015, or to reflect the occurrence of unanticipated events.

(Tables to Follow)

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Amounts in millions, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Net revenues Product sales $ 528 $ 587 $ 1,311 $ 1,357 Subscription, licensing and other revenues1 516 383 1,011 724 Total net revenues 1,044 970 2,322 2,081 Costs and expenses Cost of sales - product costs 156 187 364 412 Cost of sales - online 53 56 106 115 Cost of sales - software royalties and amortization 85 46 233 102 Cost of sales - intellectual property licenses 3 11 7 13 Product development 149 112 294 255 Sales and marketing 164 141 256 245 General and administrative 102 107 188 202 Total costs and expenses 712 660 1,448 1,344 Operating income 332 310 874 737 Interest and other expense, net 50 50 100 101 Income before income tax expense 282 260 774 636 Income tax expense 70 56 168 139 Net income $ 212 $ 204 $ 606 $ 497 Basic earnings per common share 2 $ 0.29 $ 0.28 $ 0.82 $ 0.68 Weighted average common shares outstanding 727 716 725 712 Diluted earnings per common share 2 $ 0.29 $ 0.28 $ 0.81 $ 0.67 Weighted average common shares outstanding assuming dilution 735 725 734 723

1 Subscription, licensing and other revenues represent revenues from World of Warcraft subscriptions, licensing royalties from our products and franchises, value-added services, downloadable content, and other miscellaneous revenues. 2 The company calculates earnings per share pursuant to the two-class method which requires the allocation of net income between common shareholders and participating security holders. We had, on a weighted-average basis, participating securities of approximately 9 million and 10 million for the three and six months ended June 30, 2015, respectively, and 16 million for both the three and six months ended June 30, 2014. For the three and six months ended June 30, 2015, net income attributable to Activision Blizzard, Inc. common shareholders used to calculate earnings per common share, assuming dilution, was $210 million and $597 million, respectively, as compared to total net income of $212 million and $606 million, respectively, for the same periods. For the three and six months ended June 30, 2014, net income attributable to Activision Blizzard, Inc. common shareholders used to calculate earnings per common share, assuming dilution, was $200 million and $484 million, respectively, as compared to total net income of $204 million and $497 million, respectively, for the same periods.

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Amounts in millions) June 30, December 31, 2015 2014 Assets Current assets Cash and cash equivalents $ 4,416 $ 4,848 Short-term investments 105 10 Accounts receivable, net 201 659 Inventories, net 117 123 Software development 338 452 Intellectual property licenses 26 5 Deferred income taxes, net 346 368 Other current assets 502 444 Total current assets 6,051 6,909 Long-term investments 9 9 Software development 80 20 Intellectual property licenses — 18 Property and equipment, net 179 157 Other assets 153 85 Intangible assets, net 26 29 Trademark and trade names 433 433 Goodwill 7,084 7,086 Total assets $ 14,015 $ 14,746 Liabilities and Shareholders' Equity Current liabilities Accounts payable $ 198 $ 325 Deferred revenues 837 1,797 Accrued expenses and other liabilities 510 592 Total current liabilities 1,545 2,714 Long-term debt, net 4,077 4,324 Deferred income taxes, net 126 114 Other liabilities 466 361 Total liabilities 6,214 7,513 Shareholders' equity Common stock — — Additional paid-in capital 10,163 9,924 Treasury stock (5,627 ) (5,762 ) Retained earnings 3,810 3,374 Accumulated other comprehensive loss (545 ) (303 ) Total shareholders’ equity 7,801 7,233 Total liabilities and shareholders’ equity $ 14,015 $ 14,746

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP NET INCOME TO NON-GAAP MEASURES (Amounts in millions, except per share data) Three Months Ended June 30, 2015 Net Revenues Cost of Sales - Product Costs Cost of Sales - Online Cost of Sales - Software Royalties and Amortization Cost of Sales - Intellectual Property Licenses Product Development Sales and Marketing General and Administrative Total Costs and Expenses GAAP Measurement $ 1,044 $ 156 $ 53 $ 85 $ 3 $ 149 $ 164 $ 102 $ 712 Less: Net effect from deferral of net revenues and related cost of sales1 (285 ) (59 ) — (45 ) — — — — (104 ) Less: Stock-based compensation2 — — — (3 ) — (6 ) (2 ) (10 ) (21 ) Less: Amortization of intangible assets3 — — — — (1 ) — — — (1 ) Non-GAAP Measurement $ 759 $ 97 $ 53 $ 37 $ 2 $ 143 $ 162 $ 92 $ 586 Operating Income Net Income Basic Earnings per Share Diluted Earnings per Share GAAP Measurement $ 332 $ 212 $ 0.29 $ 0.29 Less: Net effect from deferral of net revenues and related cost of sales (181 ) (136 ) (0.18 ) (0.18 ) Less: Stock-based compensation 21 16 0.02 0.02 Less: Amortization of intangible assets 1 1 — — Non-GAAP Measurement $ 173 $ 93 $ 0.13 $ 0.13 Six Months Ended June 30, 2015 Net Revenues Cost of Sales - Product Costs Cost of Sales - Online Cost of Sales - Software Royalties and Amortization Cost of Sales - Intellectual Property Licenses Product Development Sales and Marketing General and Administrative Total Costs and Expenses GAAP Measurement $ 2,322 $ 364 $ 106 $ 233 $ 7 $ 294 $ 256 $ 188 $ 1,448 Less: Net effect from deferral of net revenues and related cost of sales1 (860 ) (170 ) — (145 ) — — — — (315 ) Less: Stock-based compensation2 — — — (7 ) — (14 ) (4 ) (19 ) (44 ) Less: Amortization of intangible assets3 — — — — (3 ) — — — (3 ) Non-GAAP Measurement $ 1,462 $ 194 $ 106 $ 81 $ 4 $ 280 $ 252 $ 169 $ 1,086 Operating Income Net Income Basic Earnings per Share Diluted Earnings per Share GAAP Measurement $ 874 $ 606 $ 0.82 $ 0.81 Less: Net effect from deferral of net revenues and related cost of sales (545 ) (431 ) (0.59 ) (0.58 ) Less: Stock-based compensation 44 32 0.04 0.04 Less: Amortization of intangible assets 3 2 — — Non-GAAP Measurement $ 376 $ 209 $ 0.28 $ 0.28

1 Reflects the net change in deferred revenues and related cost of sales. 2 Includes expenses related to stock-based compensation. 3 Reflects amortization of intangible assets from purchase price accounting. The per share adjustments and the GAAP and non-GAAP earnings per share information are presented as calculated. The sum of these measures, as presented, may differ due to the impact of rounding. The company calculates earnings per share pursuant to the two-class method which requires the allocation of net income between common shareholders and participating security holders. For the three and six months ended June 30, 2015, net income attributable to Activision Blizzard, Inc. common shareholders used to calculate non-GAAP earnings per common share, assuming dilution, was $92 million and $205 million, respectively, as compared to total net income of $93 million and $209 million, respectively, for the same periods. For purposes of calculating earnings per share, we had, on a weighted-average basis, common shares outstanding of 727 million, participating securities of approximately 9 million, and dilutive shares of 8 million during the three months ended June 30, 2015. For purposes of calculating earnings per share, we had, on a weighted-average basis, common shares outstanding of 725 million, participating securities of approximately 10 million, and dilutive shares of 9 million during the six months ended June 30, 2015.

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES RECONCILIATION OF GAAP NET INCOME TO NON-GAAP MEASURES (Amounts in millions, except per share data) Three Months Ended June 30, 2014 Net Revenues Cost of Sales - Product Costs Cost of Sales - Online Cost of Sales - Software Royalties and Amortization Cost of Sales - Intellectual Property Licenses Product Development Sales and Marketing General and Administrative Total Costs and Expenses GAAP Measurement $ 970 $ 187 $ 56 $ 46 $ 11 $ 112 $ 141 $ 107 $ 660 Less: Net effect from deferral of net revenues and related cost of sales1 (312 ) (69 ) — (24 ) 1 — — — (92 ) Less: Stock-based compensation2 — — — (4 ) — (3 ) (2 ) (13 ) (22 ) Less: Amortization of intangible assets3 — — — — (1 ) — — — (1 ) Non-GAAP Measurement $ 658 $ 118 $ 56 $ 18 $ 11 $ 109 $ 139 $ 94 $ 545 Operating Income Net Income Basic Earnings per Share Diluted Earnings per Share GAAP Measurement $ 310 $ 204 $ 0.28 $ 0.28 Less: Net effect from deferral of net revenues and related cost of sales (220 ) (174 ) (0.24 ) (0.23 ) Less: Stock-based compensation 22 14 0.02 0.02 Less: Amortization of intangible assets 1 1 — — Non-GAAP Measurement $ 113 $ 45 $ 0.06 $ 0.06 Six Months Ended June 30, 2014 Net Revenues Cost of Sales - Product Costs Cost of Sales - Online Cost of Sales - Software Royalties and Amortization Cost of Sales - Intellectual Property Licenses Product Development Sales and Marketing General and Administrative Total Costs and Expenses GAAP Measurement $ 2,081 $ 412 $ 115 $ 102 $ 13 $ 255 $ 245 $ 202 $ 1,344 Less: Net effect from deferral of net revenues and related cost of sales1 (651 ) (163 ) — (49 ) 1 — — — (211 ) Less: Stock-based compensation2 — — — (11 ) — (10 ) (5 ) (27 ) (53 ) Less: Amortization of intangible assets3 — — — — (3 ) — — — (3 ) Non-GAAP Measurement $ 1,430 $ 249 $ 115 $ 42 $ 11 $ 245 $ 240 $ 175 $ 1,077 Operating Income Net Income Basic Earnings per Share Diluted Earnings per Share GAAP Measurement $ 737 $ 497 $ 0.68 $ 0.67 Less: Net effect from deferral of net revenues and related cost of sales (440 ) (346 ) (0.47 ) (0.47 ) Less: Stock-based compensation 53 33 0.05 0.04 Less: Amortization of intangible assets 3 2 — — Non-GAAP Measurement $ 353 $ 186 $ 0.25 $ 0.25

1 Reflects the net change in deferred revenues and related cost of sales. 2 Includes expenses related to stock-based compensation. 3 Reflects amortization of intangible assets from purchase price accounting. The per share adjustments and the GAAP and non-GAAP earnings per share information are presented as calculated. The sum of these measures, as presented, may differ due to the impact of rounding. The company calculates earnings per share pursuant to the two-class method which requires the allocation of net income between common shareholders and participating security holders. For the three and six months ended June 30, 2014, net income attributable to Activision Blizzard, Inc. common shareholders used to calculate non-GAAP earnings per common share, assuming dilution, was $44 million and $181 million, respectively, as compared to total net income of $45 million and $186 million, respectively, for the same periods. For purposes of calculating earnings per share, we had, on a weighted-average basis, common shares outstanding of 716 million, participating securities of approximately 16 million, and dilutive shares of 9 million during the three months ended June 30, 2014. For purposes of calculating earnings per share, we had, on a weighted-average basis, common shares outstanding of 712 million, participating securities of approximately 16 million, and dilutive shares of 11 million during the six months ended June 30, 2014.

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES FINANCIAL INFORMATION For the Three and Six Months Ended June 30, 2015 and 2014 (Amounts in millions) Three Months Ended June 30, 2015 June 30, 2014 $ Increase (Decrease) % Increase (Decrease) Amount % of Total4 Amount % of Total4 GAAP Net Revenues by Distribution Channel Retail channels $ 414 40 % $ 428 44 % $ (14 ) (3 )% Digital online channels1 569 55 476 49 93 20 Total Activision and Blizzard 983 94 904 93 79 9 Distribution 61 6 66 7 (5 ) (8 ) Total consolidated GAAP net revenues 1,044 100 970 100 74 8 Change in Deferred Revenues2 Retail channels (327 ) (317 ) Digital online channels1 42 5 Total changes in deferred revenues (285 ) (312 ) Non-GAAP Net Revenues by Distribution Channel Retail channels 87 11 111 17 (24 ) (22 ) Digital online channels1 611 81 481 73 130 27 Total Activision and Blizzard 698 92 592 90 106 18 Distribution 61 8 66 10 (5 ) (8 ) Total non-GAAP net revenues3 $ 759 100 % $ 658 100 % $ 101 15 % Six Months Ended June 30, 2015 June 30, 2014 $ Increase (Decrease) % Increase (Decrease) Amount % of Total4 Amount % of Total4 GAAP Net Revenues by Distribution Channel Retail channels $ 1,063 46 % $ 1,087 52 % $ (24 ) (2 )% Digital online channels1 1,150 50 854 41 296 35 Total Activision and Blizzard 2,213 95 1,941 93 272 14 Distribution 109 5 140 7 (31 ) (22 ) Total consolidated GAAP net revenues 2,322 100 2,081 100 241 12 Change in Deferred Revenues2 Retail channels (859 ) (804 ) Digital online channels1 (1 ) 153 Total changes in deferred revenues (860 ) (651 ) Non-GAAP Net Revenues by Distribution Channel Retail channels 204 14 283 20 (79 ) (28 ) Digital online channels1 1,149 79 1,007 70 142 14 Total Activision and Blizzard 1,353 93 1,290 90 63 5 Distribution 109 7 140 10 (31 ) (22 ) Total non-GAAP net revenues3 $ 1,462 100 % $ 1,430 100 % $ 32 2 %

1 Net revenues from digital online channels represent revenues from digitally distributed subscriptions, licensing royalties, value-added services, downloadable content, and products. 2 We provide net revenues including (in accordance with GAAP) and excluding (non-GAAP) the impact of changes in deferred revenues. 3 Total non-GAAP net revenues presented also represents our total operating segment net revenues. 4 The percentages of total are presented as calculated. Therefore the sum of these percentages, as presented, may differ due to the impact of rounding.

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES FINANCIAL INFORMATION For the Three Months Ended June 30, 2015 and 2014 (Amounts in millions) Three Months Ended June 30, 2015 June 30, 2014 $ Increase (Decrease) % Increase (Decrease) Amount % of Total6 Amount % of Total6 GAAP Net Revenues by Segment/Platform Mix Activision and Blizzard: Online1 $ 221 21 % $ 195 20 % $ 26 13 % PC 149 14 182 19 (33 ) (18 ) Next-generation (PS4, Xbox One, Wii U) 317 30 137 14 180 131 Prior-generation (PS3, Xbox 360, Wii) 242 23 342 35 (100 ) (29 ) Total console2 559 54 479 49 80 17 Mobile and other3 54 5 48 5 6 13 Total Activision and Blizzard 983 94 904 93 79 9 Distribution: Total Distribution 61 6 66 7 (5 ) (8 ) Total consolidated GAAP net revenues 1,044 100 970 100 74 8 Change in Deferred Revenues4 Activision and Blizzard: Online1 (64 ) 6 PC 36 (51 ) Next-generation (PS4, Xbox One, Wii U) (152 ) (70 ) Prior-generation (PS3, Xbox 360, Wii) (131 ) (208 ) Total console2 (283 ) (278 ) Mobile and other3 26 11 Total changes in deferred revenues (285 ) (312 ) Non-GAAP Net Revenues by Segment/Platform Mix Activision and Blizzard: Online1 157 21 201 31 (44 ) (22 ) PC 185 24 131 20 54 41 Next-generation (PS4, Xbox One, Wii U) 165 22 67 10 98 146 Prior-generation (PS3, Xbox 360, Wii) 111 15 134 20 (23 ) (17 ) Total console2 276 36 201 31 75 37 Mobile and other3 80 11 59 9 21 36 Total Activision and Blizzard 698 92 592 90 106 18 Distribution: Total Distribution 61 8 66 10 (5 ) (8 ) Total consolidated non-GAAP net revenues5 $ 759 100 % $ 658 100 % $ 101 15 %

1 Revenues from online consists of revenues from all World of Warcraft products, including subscriptions, boxed products, expansion packs, licensing royalties, and value-added services. 2 Downloadable content and their related revenues are included in each respective console platforms and total console. 3 Revenues from mobile and other includes revenues from handheld and mobile devices, as well as non-platform specific game related revenues, such as standalone sales of toys and accessories products from the Skylanders franchise and other physical merchandise and accessories. 4 We provide net revenues including (in accordance with GAAP) and excluding (non-GAAP) the impact of changes in deferred net revenues. 5 Total non-GAAP net revenues presented also represents our total operating segment net revenues. 6 The percentages of total are presented as calculated. Therefore the sum of these percentages, as presented, may differ due to the impact of rounding.

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES FINANCIAL INFORMATION For the Six Months Ended June 30, 2015 and 2014 (Amounts in millions) Six Months Ended June 30, 2015 June 30, 2014 $ Increase (Decrease) % Increase (Decrease) Amount % of Total6 Amount % of Total6 GAAP Net Revenues by Segment/Platform Mix Activision and Blizzard: Online1 $ 492 21 % $ 395 19 % $ 97 25 % PC 263 11 281 14 (18 ) (6 ) Next-generation (PS4, Xbox One, Wii U) 751 32 245 12 506 207 Prior-generation (PS3, Xbox 360, Wii) 566 24 889 43 (323 ) (36 ) Total console2 1,317 57 1,134 54 183 16 Mobile and other3 141 6 131 6 10 8 Total Activision and Blizzard 2,213 95 1,941 93 272 14 Distribution: Total Distribution 109 5 140 7 (31 ) (22 ) Total consolidated GAAP net revenues 2,322 100 2,081 100 241 12 Change in Deferred Revenues4 Activision and Blizzard: Online1 (126 ) 33 PC 48 88 Next-generation (PS4, Xbox One, Wii U) (453 ) (146 ) Prior-generation (PS3, Xbox 360, Wii) (355 ) (637 ) Total console2 (808 ) (783 ) Mobile and other3 26 11 Total changes in deferred revenues (860 ) (651 ) Non-GAAP Net Revenues by Segment/Platform Mix Activision and Blizzard: Online1 366 25 428 30 (62 ) (14 ) PC 311 21 369 26 (58 ) (16 ) Next-generation (PS4, Xbox One, Wii U) 298 20 99 7 199 201 Prior-generation (PS3, Xbox 360, Wii) 211 14 252 18 (41 ) (16 ) Total console2 509 35 351 25 158 45 Mobile and other3 167 11 142 10 25 18 Total Activision and Blizzard 1,353 93 1,290 90 63 5 Distribution: Total Distribution 109 7 140 10 (31 ) (22 ) Total consolidated non-GAAP net revenues5 $ 1,462 100 % $ 1,430 100 % $ 32 2 %

1 Revenues from online consists of revenues from all World of Warcraft products, including subscriptions, boxed products, expansion packs, licensing royalties, and value-added services. 2 Downloadable content and their related revenues are included in each respective console platforms and total console. 3 Revenues from mobile and other includes revenues from handheld and mobile devices, as well as non-platform specific game related revenues, such as standalone sales of toys and accessories products from the Skylanders franchise and other physical merchandise and accessories. 4 We provide net revenues including (in accordance with GAAP) and excluding (non-GAAP) the impact of changes in deferred net revenues. 5 Total non-GAAP net revenues presented also represents our total operating segment net revenues. 6 The percentages of total are presented as calculated. Therefore the sum of these percentages, as presented, may differ due to the impact of rounding.

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES FINANCIAL INFORMATION For the Three and Six Months Ended June 30, 2015 and 2014 (Amounts in millions) Three Months Ended June 30, 2015 June 30, 2014 $ Increase (Decrease) % Increase (Decrease) Amount % of Total3 Amount % of Total3 GAAP Net Revenues by Geographic Region North America $ 551 53 % $ 471 49 % $ 80 17 % Europe 388 37 395 41 (7 ) (2 ) Asia Pacific 105 10 104 11 1 1 Total consolidated GAAP net revenues 1,044 100 970 100 74 8 Change in Deferred Revenues1 North America (198 ) (177 ) Europe (113 ) (113 ) Asia Pacific 26 (22 ) Total changes in net revenues (285 ) (312 ) Non-GAAP Net Revenues by Geographic Region North America 353 47 294 45 59 20 Europe 275 36 282 43 (7 ) (2 ) Asia Pacific 131 17 82 12 49 60 Total non-GAAP net revenues2 $ 759 100 % $ 658 100 % $ 101 15 % Six Months Ended June 30, 2015 June 30, 2014 $ Increase (Decrease) % Increase (Decrease) Amount % of Total3 Amount % of Total3 GAAP Net Revenues by Geographic Region North America $ 1,255 54 % $ 1,035 50 % $ 220 21 % Europe 852 37 856 41 (4 ) — Asia Pacific 215 9 190 9 25 13 Total consolidated GAAP net revenues 2,322 100 2,081 100 241 12 Change in Deferred Revenues1 North America (548 ) (411 ) Europe (309 ) (237 ) Asia Pacific (3 ) (3 ) Total changes in net revenues (860 ) (651 ) Non-GAAP Net Revenues by Geographic Region North America 707 48 624 44 83 13 Europe 543 37 619 43 (76 ) (12 ) Asia Pacific 212 15 187 13 25 13 Total non-GAAP net revenues2 $ 1,462 100 % $ 1,430 100 % $ 32 2 %

1 We provide net revenues including (in accordance with GAAP) and excluding (non-GAAP) the impact of changes in deferred net revenues. 2 Total non-GAAP net revenues presented also represents our total operating segment net revenues. 3 The percentages of total are presented as calculated. Therefore the sum of these percentages, as presented, may differ due to the impact of rounding.

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES FINANCIAL INFORMATION For the Three and Six Months Ended June 30, 2015 and 2014 (Amounts in millions) Three Months Ended June 30, 2015 June 30, 2014 $ Increase (Decrease) % Increase (Decrease) Amount % of Total4 Amount % of Total4 Segment net revenues: Activision1 $ 313 41 % $ 252 38 % $ 61 24 % Blizzard2 385 51 340 52 45 13 Distribution3 61 8 66 10 (5 ) (8 ) Operating segment total 759 100 % 658 100 % 101 15 Reconciliation to consolidated net revenues: Net effect from deferral of net revenues 285 312 Consolidated net revenues $ 1,044 $ 970 74 8 % Segment income from operations: Activision1 $ 57 $ (31 ) $ 88 NM Blizzard2 117 145 (28 ) (19 ) Distribution3 (1 ) (1 ) — — Operating segment total 173 113 60 53 Reconciliation to consolidated operating income and consolidated income before income tax expense: Net effect from deferral of net revenues and related cost of sales 181 220 Stock-based compensation expense (21 ) (22 ) Amortization of intangible assets (1 ) (1 ) Consolidated operating income 332 310 22 7 Interest and other expense, net 50 50 Consolidated income before income tax expense $ 282 $ 260 22 8 % Operating margin from total operating segments 22.8 % 17.2 % Six Months Ended June 30, 2015 June 30, 2014 $ Increase (Decrease) % Increase (Decrease) Amount % of Total4 Amount % of Total4 Segment net revenues: Activision1 $ 616 42 % $ 489 34 % $ 127 26 % Blizzard2 737 50 801 56 (64 ) (8 ) Distribution3 109 7 140 10 (31 ) (22 ) Operating segment total 1,462 100 % 1,430 100 % 32 2 Reconciliation to consolidated net revenues: Net effect from deferral of net revenues 860 651 Consolidated net revenues $ 2,322 $ 2,081 241 12 % Segment income from operations: Activision1 $ 121 $ (29 ) $ 150 NM Blizzard2 256 383 (127 ) (33 ) Distribution3 (1 ) (1 ) — — Operating segment total 376 353 23 7 Reconciliation to consolidated operating income and consolidated income before income tax expense: Net effect from deferral of net revenues and related cost of sales 545 440 Stock-based compensation expense (44 ) (53 ) Amortization of intangible assets (3 ) (3 ) Consolidated operating income 874 737 137 19 Interest and other expense, net 100 101 Consolidated income before income tax expense $ 774 $ 636 138 22 % Operating margin from total operating segments 25.7 % 24.7 %

1 Activision Publishing (“Activision”) — publishes interactive entertainment products and content. 2 Blizzard Entertainment, Inc. (“Blizzard”) — publishes PC games and online subscription-based games in the MMORPG category. 3 Activision Blizzard Distribution (“Distribution”) — distributes interactive entertainment software and hardware products. 4 The percentages of total are presented as calculated. Therefore the sum of these percentages, as presented, may differ due to the impact of rounding.

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES EBITDA and Adjusted EBITDA For the Trailing Twelve Months Ended June 30, 2015 (Amounts in millions) Trailing Twelve Months Ended September 30, December 31, March 31, June 30, June 30, 2014 2014 2015 2015 2015 GAAP Net Income (Loss) $ (23 ) $ 361 $ 394 $ 212 $ 945 Interest Expense, net 51 51 50 50 202 Provision (Benefit) for income taxes (20 ) 27 98 70 175 Depreciation and amortization 22 29 20 21 91 EBITDA 30 468 562 353 1,413 Deferral of net revenues and related cost of sales1 180 475 (362 ) (181 ) 110 Stock-based compensation expense2 22 29 23 21 95 Fees and other expenses related to the Purchase Transaction and related debt financings3 48 (36 ) — — 13 Adjusted EBITDA $ 280 $ 936 $ 223 $ 193 $ 1,631

1 Reflects the net change in deferred revenues and related cost of sales. 2 Includes expenses related to stock-based compensation. 3 Reflects fees and other expenses (including legal fees, costs, expenses and accruals) related to the repurchase of 429 million shares of our common stock from Vivendi (the "Purchase Transaction") completed on October 11, 2013 and related debt financings. Trailing twelve months amounts are presented as calculated. Therefore the sum of the four quarters, as presented, may differ due to the impact of rounding.

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES Outlook for the Quarter Ending September 30, 2015 and Year Ending December 31, 2015 GAAP to Non-GAAP Reconciliation (Amounts in millions, except per share data) Outlook for the Outlook for the Three Months Ending Year Ending September 30, 2015 December 31, 2015 Net Revenues (GAAP) $ 875 $ 4,425 Excluding the impact of: Change in deferred revenues1 55 175 Net Revenues (Non-GAAP) $ 930 $ 4,600 Earnings Per Diluted Share (GAAP) $ 0.08 $ 1.06 Excluding the impact of: Deferral of net revenues and related cost of sales2 0.03 0.14 Stock-based compensation3 0.02 0.09 Amortization of intangible assets4 — 0.01 Earnings Per Diluted Share (Non-GAAP) $ 0.14 $ 1.30