Activision Blizzard to Lay off 8% of Workforce

Most of the job cuts will come from support staff as the video game publisher prioritizes investment in its biggest franchises.
Matthew HellerFebruary 13, 2019
Activision Blizzard to Lay off 8% of Workforce

Activision Blizzard is planning to lay off 8% of its workforce as it focuses on increasing its game-development staff for such franchises as Call of Duty and Diablo.

The company has a reported workforce of 9,800, meaning around 780 people could lose their jobs in the coming months. It confirmed the layoffs in the quarterly earnings call on Monday after initially notifying employees earlier in the day.

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“Over the last few years, many of our non-development teams expanded to support various needs,” Blizzard president J. Allen Brack said in a note to staff. “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 organization.”

The cuts will mostly affect non-game-development departments, Activision said.

The announcement came as Activision reported fourth-quarter sales of $2.84 billion, missing analysts’ estimates of $3.04 billion. It also said it expected to bring in $6.025 billion in 2019, a major decline from its 2018 revenues of $7.5 billion.

“The company’s reduced forecast comes after a turbulent year in the video game industry,” the Los Angeles Times said, noting that the meteoric rise of the free-to-play online game Fortnite “shook investor confidence in the business models of major publishers including Activision Blizzard.”

In recent months, the company has also been hit by the departures of the CFOs for both the Activision and Blizzard divisions.

“While our financial results for 2018 were the best in our history, we didn’t realize our full potential,” CEO Bobby Kotick said in a news release.

In 2019, Activision said, it will increase development investment in its biggest franchises, with the number of developers working on Call of Duty, CandyCrush, Overwatch, Warcraft, Hearthstone, and Diablo rising by about 20% over the course of the year.

The Activision division had 53 million monthly active users in the fourth quarter, growing double-digits quarter-over-quarter, while the Blizzard division had 35 million MAUs.

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