Activision Blizzard lays off hundreds despite ‘record results’ last year

13 Feb 2019237 Views

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Still from ‘Overwatch Seasonal Event | Overwatch Lunar New Year 2019’ . Image: PlayOverwatch/YouTube

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Game publisher Activision Blizzard has announced it is cutting hundreds of staff, in spite of CEO Bobby Kotick praising 2018’s financial results.

Game publisher Activision Blizzard is behind an array of major titles, including Call of Duty, Overwatch, Candy Crush and many others. Yesterday (12 February), the company announced it would be cutting 8pc of its workforce. The firm had around 9,600 employees, which places approximately 800 people out of work.

The company manages various organisations, including Activision, Blizzard and King. On its earnings call, CEO Bobby Kotick told investors that the organisation had “once again achieved record results in 2018” but added that the company would be restructuring and consolidating because of missed expectations for last year and lower expectations in 2019.

CEO discusses layoffs

Kotick wrote: “While our financial results for 2018 were the best in our history, we didn’t realise our full potential. To help us reach our full potential, we have made a number of important leadership changes.

“These changes should enable us to achieve the many opportunities our industry affords us, especially with our powerful owned franchises, our strong commercial capabilities, our direct digital connections to hundreds of millions of players and our extraordinarily talented employees.”

According to Ars Technica, market analysts say the positive results may have come thanks to a small group of franchises, with other efforts outside the large successes not meeting expectations.

Bungie, the developer of the former marquee Activision Blizzard franchise Destiny, severed ties with Activision Blizzard, and this may have left many in marketing and other areas without a major title to work on.

Activision Blizzard focusing on other areas

Kotick said the company will now be investing mostly in live services, e-sports and Battle.net, focusing on franchises including Call of Duty, Overwatch, Diablo, Candy Crush and Hearthstone.

Kotaku acquired a message sent by Blizzard president J Allen Brack to staff, outlining the changes ahead: “Over the last few years, many of our non-development teams expanded to support various needs. Currently, staffing levels on some teams are out of proportion with our current release slate.

“This means we need to scale down some areas of our organisation in the US today. In our regional offices, we anticipate similar evaluations, subject to local requirements.”

Kotaku also noted the letter indicates those being laid off will receive continuing health benefits, severance pay and career placement advice, but the intricacies of these offerings are not public.

Ellen Tannam is a writer covering all manner of business and tech subjects

editorial@siliconrepublic.com