Activision Blizzard, Inc. (ATVI) has reported 59.75 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $254 million, or $0.33 a share in the quarter, compared with $159 million, or $0.21 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $496 million, or $0.65 a share compared with $184 million or $0.25 a share, a year ago.

Revenue during the quarter surged 48.85 percent to $2,014 million from $1,353 million in the previous year period. Gross margin for the quarter expanded 123 basis points over the previous year period to 61.47 percent. Total expenses were 78.90 percent of quarterly revenues, down from 81.52 percent for the same period last year. This has led to an improvement of 262 basis points in operating margin to 21.10 percent.

Operating income for the quarter was $425 million, compared with $250 million in the previous year period.

However, the adjusted operating income for the quarter stood at $681 million compared to $284 million in the prior year period. At the same time, adjusted operating margin improved 1282 basis points in the quarter to 33.81 percent from 20.99 percent in the last year period.

Bobby Kotick, chief executive officer of Activision Blizzard, said, "Our record performance in 2016 further strengthened our position as the world’s leading standalone interactive entertainment company. For the quarter and the year, we delivered our highest revenues, non-GAAP redefined operating margins and earnings per share, well surpassing our own expectations."

For the first-quarter, Activision Blizzard projects revenue to be $1,550 million. The company  expects adjusted revenue to be $1,550 million. The company forecasts diluted earnings per share to be $0.25. On an adjusted basis, the company forecasts diluted earnings per share to be $0.51.

For financial year 2017, Activision Blizzard projects revenue to be $6,000 million. The company  expects adjusted revenue to be $6,000 million. The company forecasts diluted earnings per share to be $0.72. The company forecasts diluted earnings per share to be $1.70 on adjusted basis.

Operating cash flow improves significantly
Activision Blizzard, Inc. has generated cash of $2,155 million from operating activities during the year, up 71.17 percent or $896 million, when compared with the last year.

The company has spent $1,177 million cash to meet investing activities during the year as against cash outgo of $3,716 million in the last year.

Cash flow from financing activities was $500 million for the year as against cash outgo of $202 million in the last year period.

Cash and cash equivalents stood at $3,245 million as on Dec. 31, 2016, up 78 percent or $1,422 million from $1,823 million on Dec. 31, 2015.

Working capital increases sharply
Activision Blizzard, Inc. has recorded an increase in the working capital over the last year. It stood at $2,174 million as at Dec. 31, 2016, up 180.15 percent or $1,398 million from $776 million on Dec. 31, 2015. Current ratio was at 1.82 as on Dec. 31, 2016, up from 1.30 on Dec. 31, 2015.

Cash conversion cycle (CCC) has decreased to 6 days for the quarter from 10 days for the last year period. Days sales outstanding went down to 17 days for the quarter compared with 23 days for the same period last year.

Days inventory outstanding has decreased to 3 days for the quarter compared with 11 days for the previous year period. At the same time, days payable outstanding went down to 13 days for the quarter from 24 for the same period last year.