Activision Blizzard Inc., balance sheet: property, plant and equipment

US$ in millions

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Land	1	1	1	1	1
Buildings	4	4	4	4	4
Leasehold improvements	252	248	224	162	109
Computer equipment	654	700	658	560	431
Office furniture and other equipment	91	99	92	78	52
Cost of property and equipment	1,002	1,052	979	805	597
Accumulated depreciation	(749)	(770)	(685)	(547)	(408)
Property and equipment, net	253	282	294	258	189

Item	Description	The company
Cost of property and equipment	Amount before accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures.	Activision Blizzard Inc.’s cost of property and equipment increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level.
Property and equipment, net	Amount after accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business to produce goods and services and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures.	Activision Blizzard Inc.’s property and equipment, net decreased from 2017 to 2018 and from 2018 to 2019.

Activision Blizzard Inc., asset age ratios

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Average age ratio	74.83%	73.26%	70.04%	68.03%	68.46%
Estimated total useful life (years)	8	8	8	7	7
Estimated age, time elapsed since purchase (years)	6	6	5	5	5
Estimated remaining life (years)	2	2	2	2	2

Asset age ratio	Description	The company
Average age ratio	As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company’s fixed asset base is old or new. Newer assets are likely to be more efficient.	Activision Blizzard Inc.’s average age ratio of depreciable property, plant and equipment deteriorated from 2017 to 2018 and from 2018 to 2019.
Estimated total useful life	Over longer time periods, this ratio is a useful measure of company’s depreciation policy and can be used for comparisons with competitors.	Activision Blizzard Inc.’s estimated total useful life of depreciable property, plant and equipment increased from 2017 to 2018 and from 2018 to 2019.
Estimated time elapsed since purchase	The approximate age in years of a company’s fixed assets. Useful for comparison purposes.	Activision Blizzard Inc.’s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2017 to 2018 and from 2018 to 2019.
Estimated remaining life		Activision Blizzard Inc.’s estimated remaining life of depreciable property, plant and equipment decreased from 2017 to 2018 and from 2018 to 2019.

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Selected Financial Data (US$ in millions)
Accumulated depreciation	749	770	685	547	408
Cost of property and equipment	1,002	1,052	979	805	597
Land	1	1	1	1	1
Asset Age Ratio
Average age¹	74.83%	73.26%	70.04%	68.03%	68.46%

2019 Calculations

¹ Average age = 100 × Accumulated depreciation ÷ (Cost of property and equipment – Land)
= 100 × 749 ÷ (1,002 – 1) = 74.83%

Asset age ratio	Description	The company
Average age	As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company’s fixed asset base is old or new. Newer assets are likely to be more efficient.	Activision Blizzard Inc.’s average age ratio of depreciable property, plant and equipment deteriorated from 2017 to 2018 and from 2018 to 2019.

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Selected Financial Data (US$ in millions)
Cost of property and equipment	1,002	1,052	979	805	597
Land	1	1	1	1	1
Depreciation expense	124	138	130	121	82
Asset Age Ratio (Years)
Estimated total useful life¹	8	8	8	7	7

2019 Calculations

¹ Estimated total useful life = (Cost of property and equipment – Land) ÷ Depreciation expense
= (1,002 – 1) ÷ 124 = 8

Asset age ratio	Description	The company
Estimated total useful life	Over longer time periods, this ratio is a useful measure of company’s depreciation policy and can be used for comparisons with competitors.	Activision Blizzard Inc.’s estimated total useful life of depreciable property, plant and equipment increased from 2017 to 2018 and from 2018 to 2019.

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Selected Financial Data (US$ in millions)
Accumulated depreciation	749	770	685	547	408
Depreciation expense	124	138	130	121	82
Asset Age Ratio (Years)
Time elapsed since purchase¹	6	6	5	5	5

2019 Calculations

¹ Time elapsed since purchase = Accumulated depreciation ÷ Depreciation expense
= 749 ÷ 124 = 6

Asset age ratio	Description	The company
Estimated time elapsed since purchase	The approximate age in years of a company’s fixed assets. Useful for comparison purposes.	Activision Blizzard Inc.’s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2017 to 2018 and from 2018 to 2019.

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Selected Financial Data (US$ in millions)
Property and equipment, net	253	282	294	258	189
Land	1	1	1	1	1
Depreciation expense	124	138	130	121	82
Asset Age Ratio (Years)
Estimated remaining life¹	2	2	2	2	2

2019 Calculations

¹ Estimated remaining life = (Property and equipment, net – Land) ÷ Depreciation expense
= (253 – 1) ÷ 124 = 2

Asset age ratio	Description	The company
Estimated remaining life		Activision Blizzard Inc.’s estimated remaining life of depreciable property, plant and equipment decreased from 2017 to 2018 and from 2018 to 2019.

Activision Blizzard Inc. (NASDAQ:ATVI)

Analysis of Property, Plant and Equipment