I was surprised to learn that the HK debacle with Activision Blizzard barely had any effect on its stock.

In fact, a lot of the time, bad press seems to barely affect the stock market at all.

Why does nothing happen a lot of the time?

  • There's really no way to tell. Perhaps the news was already anticipated and priced in by the market? Or perhaps the news doesn't think the news will have a material financial impact? Or perhaps the market just doesn't care.
    – D Stanley
    Nov 5, 2019 at 15:32
  • Why do you feel it should affect the stock? There are multiple types of investors, and I'd wager a lot are purely financial in their interests. As such, if they don't expect particular news to affect earnings, then there is no need for the news to affect the stock. Nov 5, 2019 at 15:33
  • Wouldn't bad press for a consumer oriented company result in less sales, therefore less revenue and less dividends? Or do investors just expect them to power through with reserves? Nov 5, 2019 at 15:36
  • It depends if they feel the bad press may actually impact earnings. Bad press happens a lot, and not all of it actually affects overall averaged earnings that investors care about. A different example is Facebook who took a few hits from bad press, but I suspect that's because Facebook had a larger than usual "average joe" investor base. But that's just my opinion. Nov 5, 2019 at 15:42
  • Despite all the press about cigarettes, Altria was up 2,300 pct or so over the past 20 years. What drove profits was revenues and profits not news clips. So the question with Blizzard is whether the 'bad news' will have a material impact on the bottom line or not. Nov 5, 2019 at 15:51

2 Answers 2


Was the whole debacle actually bad press from the view of an investor?

It showed that Activision Blizzard is willing to take a PR hit among their customers in liberal countries in order to maintain their permission to operate on the Chinese market.

The Chinese gaming market is a market which is currently growing very fast. There is a lot of money to be made there, and it is expected to grow even more over the next decades. But that market is not very accessible for foreign companies. The Chinese government hand-picks companies which get access to it, both for censorship reasons and for market protectionism reasons.

And while gamers are a demographic which consists of a couple very loud activists with a short attention span and a silent majority who couldn't care less about drama, autoritarian governments do not forget and forgive that easily.

So choosing the Chinese government over the Western fans could be seen as a smart move for many investors which will rather increase the value of the company in the long-term.

  • This reminds me of an old board game I used to play with my friends. "Junta". You vyed for the control of a banana republic through and used the dictators handbook to corrump and blackmail your way to a large swiss bank account. It had an event card called "The students are rioting" - and below written: "Effect: None"
    – Stian
    Nov 6, 2019 at 14:04
  • @StianYttervik I wouldn't be that cynical, though. Protesting Blizzard could hurt their business outside of China. So non-Chinese consumers can at least make sure that their company bottom line benefits as little as possible from sucking up to China. But that does of course depend on how willing people are to stand by their word by voting with their wallets and refusing to buy their next games like Overwatch 2 or Diablo 4.
    – Philipp
    Nov 6, 2019 at 14:36

The real question is whether or not investors think that a specific kind of bad press will or will not cause a permanent reduction in sales.

If investors think this is a tempest in a teapot, and that most people won't stop playing Call Of Duty just to show solidarity with protesters half way around the world, then there's no reason for them to sell Activision Blizzard shares.

  • if only 5% of investors thought that it may hurt the company, wouldn't it have at least some measurable effect on the stock? Nov 5, 2019 at 15:58
  • 1
    @user2741831, I'd consider those few investors noise in the overall market. For example, let's say 5% did think that... but maybe another 5% thought the recent company actions (aside from this incident, like product launches...etc), would help the stock. Most investors are after longer averaged returns, not worrying about near term day or two spikes or dips. Nov 5, 2019 at 16:10
  • @user2741831 finance.yahoo.com/quote/ATVI take a look for yourself.
    – RonJohn
    Nov 5, 2019 at 16:12
  • 5
    Bottom line, fluctuations to stocks happen a lot, even within the hour level, to some extent it may be difficult to distinguish random noise from actual investor sentiment of a minority segment. Nov 5, 2019 at 16:13
  • Put another way, the 5% dumping their stock doesn't affect the share price; the price others are willing to pay for those shares does. Just because they want out doesn't mean others won't want in even more.
    – chepner
    Nov 6, 2019 at 14:15

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