The new development at Activision Blizzard has left many bewildered. Yesterday, the media exploded with news that the company laid off almost 800 people, as announced a few days ago, even though it announced that 2018 was the record year for its business.
“While our financial results for 2018 were the best in our history, we didn’t realize our full potential,” said Bobby Kotick, CEO of Activision Blizzard in an earnings call. “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.”
Kotick also announced that the company will cut almost 8 percent of jobs which is 775 employees out of 9,600. These cuts mostly affected employees who are not part of the company’s game development divisions like publishing and esports. The reason for this action is that Activision Blizzard wants to restructure its business since it won’t have any major releases in 2019. The laid offs happen across all its organizations and based on Kotaku sources they include “Activision publishing, Blizzard, King, and some of Activision’s studios, including High Moon”. However, the company also announced it will invest more in the development staff of big franchises like Diablo and Call of Duty.
“Over the last few years, many of our non-development teams expanded to support various needs,” said Blizzard president J. Allen Brack in a note to staff obtained by Kotaku. “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. I’m sorry to share that we will be parting ways with some of our colleagues in the U.S. today. In our regional offices, we anticipate similar evaluations, subject to local requirements.”
Additionally, the letter stated that laid-off employees will receive a severance package, career coaching, keep health benefits and receive help with job placement. Those from Blizzard will also receive the bonus for the previous year, as they were entitled per their contracts.
Although the rumors about cutting down a number of employees at Activision Blizzard have been around for a while, they heated up last week. But even with that, some employees were taken back and it seems they had no idea that this will be happening. Reports say employees were crying on the parking lot and exchanging hugs the morning these laid offs happened.
Also, Brack’s letter proves what had been said by Blizzard back in 2018 that the company wants to cut costs and concentrate on producing more games.
“It’s critical that we prioritize product development and grow the capacity of the teams doing this work to best serve our player community,” said Brack in the mentioned letter. “We also need to evolve operationally to provide the best support for new and existing products.”
How all this will affect further Activision Blizzard plans remains to be seen, as well as possible next steps in the restructuring. For now, Activision Blizzard has left the gaming community little confused and not in a good mood, so their next move needs to be something epic to return its good graces. Say, to announce new Diablo sequel, for example, which fans have been dying to get for a while now.