Updated from 5:14 p.m. EST
revenue fell 15% in the second quarter, but the result exceeded Wall Street's forecast.
As it had announced on Oct. 25, the company said revenue fell to $188.2 million from $222.5 million a year earlier. A Thomson First Call analyst survey was expecting $163.39 million.
Shares of Activision were up 2 cents to $15.72 in after-hours trading.
In light of the ongoing review of the company's historical stock option grant practices, the company did not release earnings results.
During the second quarter ended Sept. 30, Activision said its
Call of Duty 2
title for the Xbox 360 console crossed the 1 million unit sales mark in the U.S., making it the best-selling game to date on the Xbox 360 system.
For the third quarter, Activision expects revenue of $600 million, largely driven by the release of five launch titles for the
Wii gaming console. It will be the largest lineup of product releases in the company's history, said Bobby Kotick, CEO of Activision.
Analysts are expecting to see $584.21 million for the quarter.
For the fourth quarter, Activision hopes to see revenue of $175 million, down from analysts' expectations of $191.79 million.
Activision had announced on Oct. 25 that it had increased its full-year revenue outlook to $1.15 billion from its prior net revenue outlook of $1.075 billion.
Growth is likely to stem from the release of a number of new gaming consoles over the next few months, a move that could draw in more users and benefit Activision, the second-largest video game publisher.
is set to release its PlayStation 3 gaming console later this month and the Wii is will be on shelves soon.
Meanwhile, Activision said it is working to improve organizational efficiencies so it can port games developed for one gaming platform to another at reduced costs.
The company also reiterated Monday that the increase in its third quarter and full-year revenue outlook will be offset by higher legal expenses relating primarily to its internal review of historical stock option practices, including expenses relating to the previously announced informal SEC inquiry and derivative litigation, and the impact of the delayed release of
PlayStation 3 system in Europe until March 2007. The company expects that the majority of the impact will occur in the third quarter.
Activision also reaffirmed its fiscal year 2008 net revenue outlook, which is expected to exceed $1.6 billion.