‘Skylanders’ Is Officially Activision’s Newest $1 Billion Franchise

Activision Blizzard Inc. (NASDAQ:ATVI), the video game publisher behind “Call of Duty” -- the most commercially successful series in the history of the industry -- now has another $1 billion franchise under its belt.

The Santa Monica, Calif.-based company revealed on Monday that its game-toy hybrid franchise “Skylanders” has topped $1 billion in worldwide retail sales. This figure reflects all sales for the “Skylanders” franchise since it debuted just 15 months ago, including the two major home console titles: “Skylanders: Spyro’s Adventure” and the 2012 holiday release “Skylanders: Giants.”

Since the franchise first debuted in 2011, Activision CEO Bobby Kotick has maintained a pledge that he would create a new $1 billion franchise from the toy series by successfully wedding two types of entertainment, toys and video games, which have historically seemed irreconcilable.

Indeed, “Skylanders” unprecedented growth over the last 15 months comes after a long line of ambitious flops from other video game developers and toy designers trying to combine the two for their obvious merchandising potential. Countless examples of everything from failed Pokémon projects to Disney’s (NYSE:DIS) new “Disney Infinity” venture show that the toy market is a precarious one even for the most seasoned entertainment publisher.

“The ‘Skylanders’ franchise became the first kids’ video game IP to cross the $1 billion mark in just 15 months, and I think we are still just starting to realize its potential,” Activision publishing CEO Eric Hirshberg said in a statement.

“We knew that the simple, but magical idea, of bringing your toys to life in a video game could change both the video game and the toy industries, and more importantly, change the way kids play.”

Paul Reiche, a game industry veteran who co-created “Skylanders” with his studio Toys for Bob, echoed Hirshberg’s sentiment in an interview with The Hollywood Reporter Monday, saying “’Skylanders’ is really defined by this interaction between toys and a video game.”

1. The rapid growth of “Skylanders” can only mean good things for the company, which admitted that it expected sales for the next “Call of Duty” to fall despite posting its best year ever for 2012. While “Call of Duty” has proven to be an enormous success for the company, many industry analysts have begun to wonder if the franchise’s meteoric rise is sustainable throughout the next console generation. Activision managed to all but avoid the industrywide dip in sales that hit last year during the holidays thanks to a drop in both the amount of games being released and the number of gamers looking to buy them. But concerns over the viability of the current console market have not been allayed by the presence of Nintendo’s (PINK:NTDOY) Wii U console and the relative silence of Microsoft (NASDAQ:MSFT) and Sony (NYSE:SNE) about their next-generation hardware. Having another billion-dollar franchise will no doubt help Activision weather the storm until the next Xbox or PlayStation device arrives to bring back its core “Call of Duty” fanbase for another generation of “hardcore” first-person shooters.

Activision Blizzard shares rose more than a percent in Monday trading, closing at $13.57 per share.