Activision, Inc. — 2004 Annual Report Selected Consolidated Financial Data The following table summarizes certain selected consolidated financial data, which should be read in conjunction with our Consolidated Financial Statements and Notes thereto and with Management’s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere herein. The selected consolidated financial data presented below as of and for each of the fiscal years in the five-year period ended March 31, 2004 are derived from our audited consolidated financial statements. The Consolidated Balance Sheets as of March 31, 2004 and 2003 and the Consolidated Statements of Operations and Consolidated Statements of Cash Flows for each of the fiscal years in the three-year period ended March 31, 2004, and the reports thereon, are included elsewhere in this Annual Report. page 13 (In thousands, except per share data) Restated (1) Year ended March 31, 2004 (2) 2003 (2) 2002 (2) 2001 2000 Statement of Operations Data: Net revenues $947,656 $ 864,116 $786,434 $620,183 $572,205 Cost of sales—product costs 475,541 440,977 435,725 324,907 319,422 Cost of sales—intellectual property licenses  and software royalties and amortization 91,606 124,196 99,006 89,702 91,238 Income (loss) from operations 109,817 94,847 80,574 39,807 (30,325) Income (loss) before income tax provision  (benefit) 115,992 103,407 83,120 32,544 (38,736) Net income (loss) 77,715 66,180 52,238 20,507 (34,088) Basic earnings (loss) per share 0.58 0.46 0.46 0.24 (0.41) Diluted earnings (loss) per share 0.54 0.43 0.39 0.22 (0.41) Basic weighted average common shares  outstanding 133,249 144,359 113,966 83,921 83,334 Diluted weighted average common shares  outstanding 144,893 155,483 133,775 92,475 83,334 Cash Provided by (Used in): Operating activities 67,403 90,975 111,792 81,565 2,883 Investing activities (15,169) (155,101) (8,701) (8,631) (25,041) Financing activities 117,569 64,090 50,402 2,547 42,028 As of March 31, 2004 (2) 2003 (2) 2002 (2) 2001 2000 Balance Sheet Data: Working capital $675,796 $ 422,500 $333,199 $182,980 $158,225 Cash, cash equivalents and short-term  investments 587,649 406,954 279,007 125,550 49,985 Capitalized software development and  intellectual property licenses 135,201 107,921 56,742 42,205 40,808 Goodwill 76,493 68,019 35,992 10,316 12,347 Total assets 968,817 704,816 556,887 359,957 309,737 Long-term debt — 2,671 3,122 63,401 73,778 Shareholders’ equity 832,738 597,740 430,091 181,306 132,009 (1) Consolidated financial information for fiscal years 2003–2000 has been restated for the effect of our three-for-two stock split effected in the form of a 50% stock dividend to shareholders of record as of February 23, 2004, paid March 15, 2004. (2) Effective April 1, 2001, we adopted the provisions of Statement of Financial Accounting Standards (“SFAS”) No. 142, “Goodwill and Other Intangibles.” SFAS No. 142 addresses financial accounting and reporting requirements for acquired goodwill and other intangible assets. Under SFAS No. 142, goodwill is deemed to have an indefinite useful life and should not be amortized but rather tested at least annually for impairment. In accordance with SFAS No. 142, we have not amortized goodwill during the years ended March 31, 2004, 2003 and 2002.