By Matt Peckham
August 6, 2014

Activision Blizzard is doing very well, according to CEO Bobby Kotick, who trotted out glowing figures during the company’s second quarter earnings call Tuesday, going so far as to raise Activision Blizzard’s full-year outlook. But when Blizzard president Mike Morhaime took his turn on the call, he admitted the company’s juggernaut MMO, World of Warcraft, has continued to hemorrhage subscribers.

The franchise remains “healthy,” he said, according to Seeking Alpha’s transcript of the call, with year-on-year revenue up, but subscribers down sharply in recent months. Here’s Morhaime:

WoW‘s current subscriber number stands at 6.8 million, according to Activision Blizzard. That’s down 800,000 from last quarter, when it stood at 7.6 million — itself a precipitously lower figure than the once-towering 12 million the game commanded at its subscription peak in October 2010. No surprise to anyone (including Activision Blizzard) given the game’s age and shifting platform as well as genre demographics, WoW‘s subscription figures have been dropping steadily since 2010’s close.

The last time WoW‘s base was this low (or high, depending on your vantage): mid-2006, a year-and-a-half after the game’s launch in November 2004. Activision Blizzard expects to arrest that drop this fall, when it releases its fifth (and possibly final) expansion for the game, Warlords of Draenor. According to Morhaime:

That uptick brought nearly a million users back to the fold in mid-2012, but the declines began shortly after the last expansion’s release, and by the close of 2012, WoW had lost several hundred thousand subscribers. The game leveled off through most of 2013 in the mid-7-million range, before the sharp drop from 7.6 million to 6.8 million this year.

Again, the claim to pay most attention to is Morhaime’s about year-on-year revenue being up. That’s what matters to investors, less so subscriber numbers. If Blizzard can keep WoW revenues up and deliver profits that surpass expectations, the game’s in no danger of disappearing anytime soon. That said, the clock is ticking for the company to unveil its long-rumored, still-running-silent Next Big Thing, be that a new MMO (the so-called new IP, once codenamed “Titan,” and as of August 2013 developmentally rebooted), or something else entirely.

We’ll know more about Warlords of Draenor next week, August 14 at 12:30 a.m. ET, when Blizzard reveals the expansion’s launch date and first cinematic trailer at the Ace Theatre in Los Angeles. Activision Blizzard says 1.5 million (of the game’s roughly 3 million Western) players have already preordered the expansion.

Write to Matt Peckham at matt.peckham@time.com.

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