Photo : Michael Buckner ( Getty Images ) Publisher Activision Blizzard has begun its long-rumored layoff process, informing employees this afternoon that it will be cutting staff. On an earnings call this afternoon, the company said that it would be eliminating 8% of its staff. In 2018, Activision Blizzard had roughly 9,600 employees, which would mean nearly 800 people are now out of work. Advertisement This afternoon, the mega-publisher began notifying those who are being laid off across its various organizations, which include Activision, Blizzard, and King. On the earnings call, Activision Blizzard CEO Bobby Kotick told investors that the company had “once again achieved record results in 2018" but that the company would be consolidating and restructuring because of missed expectations for 2018 and lowered expectations for 2019. The company said it would be cutting mainly non-game-development departments and bolstering its development staff for franchises like Call of Duty and Diablo. Development sources from across the industry told Kotaku this afternoon that the layoffs have affected Activision publishing , Blizzard, King, and some of Activision’s studios, including High Moon. At Blizzard, the layoffs appear to only have affected non-game-development departments, such as publishing and esports, both of which were expected to be hit hard. “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 around 1pm PT that was 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.” The letter also promised “a comprehensive severance package,” continued health benefits, career coaching, and job placement assistance as well as profit-sharing bonuses for the previous year to those who are being laid off at Blizzard. (Blizzard employees receive twice yearly bonuses based on how the company performed financially.) “There’s no way to make this transition easy for impacted employees, but we are doing what we can to support our colleagues,” Brack wrote. Advertisement The news follows months of rumors about layoffs at the publisher, which heated up early last week as word began to spread that hundreds of people across Activision Blizzard’s various divisions might lose their jobs. Leading up to today, some of the publisher’s employees had been coming to work with no clue as to what might happen. One person at Blizzard told me this morning that as employees arrived, they cried and exchanged hugs in the parking lot. Last fall, Kotaku reported that Blizzard’s 2018 mandate had been to cut costs and produce more games, and that as a result, layoffs would likely hit the company’s support departments even as Blizzard continues to expand its development teams. Brack’s email suggests the same. “It’s critical that we prioritize product development and grow the capacity of the teams doing this work to best serve our player community,” he wrote. “We also need to evolve operationally to provide the best support for new and existing products.” Advertisement Meanwhile, in a press release to investors this afternoon, Activision CEO Bobby Kotick wrote: “While our financial results for 2018 were the best in our history, we didn’t realize 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.”<doc-sep>Start transforming your game’s economy and increase your bottom line. Get the free guide now. Elevate your enterprise data technology and strategy at Transform 2021. Activision is planning to cut “non-development jobs” because it isn’t releasing enough games. This news comes via a Kotaku report that claims new Blizzard boss J. Allen Brack sent a letter to employees detailing the layoffs. GamesBeat has separately confirmed that Activision Publishing boss Rob Kotish sent a message to employees that said layoffs are coming. He did not get into specifics in that message. And confirming everything above reported above, the publisher is laying off people across Activision Publishing, Blizzard Entertainment, and King. During a conference call with investors this afternoon, Activision said it is cutting 8 percent of jobs, which is about 800 of 9,600 employees. This reorganization is primarily about taking money away from non-development jobs and putting those resources into its game-creation teams. Here’s how Brack explained the layoffs in his letter obtained by Kotaku: “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 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.” I have reached out to Activision Blizzard for a statement, and I will update this story with any comment. But these layoffs come as the company is also reporting the results of its 2018 fiscal year. Cutting jobs while setting records Activision Blizzard generated $2.38 billion in revenue, and the company was quick to point out that was an all-time record. At the same time, the company said that making more money than ever is not enough. “While our financial results for 2018 were the best in our history, we didn’t realize our full potential,” said Kotick said in the earnings release. “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.” Wall Street expected Activision Blizzard to generate closer to $3 billion in revenues, and investors care more about that than company records. The publisher also has a dim outlook for its fiscal 2019, which it is calling a transition year. Overall, the company expects revenues to drop 13 percent year-over-year. So the company is making layoffs to deal with concerns about its future. Activision’s plan The layoffs are just step one of Activison’s plan to return to growth. It also plans to put more people on its top franchises to increase the rate at which it is outputting content. “The number of developers working on Call of Duty, CandyCrush, Overwatch, Warcraft, Hearthstone, and Diablo in aggregate will increase approximately 20 percent over the course of 2019,” reads Activision’s quarterly report. “The company will fund this greater investment by de-prioritizing initiatives that are not meeting expectations and reducing certain non-development and administrative-related costs across the business.” Activision wants this increase in developers to lead to more game releases and more in-game content. The rest of Activision’s plan is to use its existing infrastructure to better sell games. This likely means advertising more of its games in King mobile titles and putting more releases into Battle.net. But the company leadership did not provide many details about how this will work beyond the following statements. “[Activision will focus on] integrating our global and regional sales and go-to-market, partnerships, and sponsorships capabilities across the business,” reads the company’s press release. “[And by] enabling better leverage talent, expertise, and scale on behalf of our business units.” I don’t know what that means, but I’m sure Bobby has it under control. Correction: This story originally claimed that Bobby Kotick sent a message to employees about layoffs. This was a mistake. Activision Publishing boss Rob Kotish actually sent the message. I’ve corrected and apologize for the error.<doc-sep>Activision Blizzard has announced that it’s laying off 8 percent of its employees — roughly 770 people — as part of the company “de-prioritizing initiatives that are not meeting expectations.” The news came on the heels of announcement of Activision Blizzard’s Q4 and 2018 earnings, where CEO Bobby Kotick gave the company’s “record results in 2018.” Kotick went on to comment that, “While our financial results for 2018 were the best in our history, we didn’t realize our full potential.” As such, Activision Blizzard says that it’ll be focusing more on its biggest franchises: Call of Duty, Candy Crush, Overwatch, Warcraft, Hearthstone, and Diablo, with plans to increase developers across those titles by “approximately 20% over the course of 2019.” (Destiny, another one of Activision’s marquee titles, parted ways with the publisher in January and is now back in the hands of developer Bungie.) On the flip side, Activision Blizzard said that it’ll fund those increases “by de-prioritizing initiatives that are not meeting expectations and reducing certain non-development and administrative-related costs across the business,” resulting in the nearly 800 laid off employees. According to Variety, the job cuts will be coming from support staff as Activision Blizzard reworks some of its commercial and marketing teams. A Kotaku report elaborates that employees were cut across most of the company, noting that “layoffs have affected Activision, Blizzard, King, and some of Activision’s studios, including High Moon,” although Blizzard itself largely saw cuts only to “non-game-development departments.”<doc-sep>Activision Activision Blizzard, the publisher of blockbuster games like Call of Duty: Black Ops 4, World of Warcraft and Overwatch, just posted its best financial results in the company's history. Now, it's likely going to lay off hundreds of employees. According to Variety, Activision Blizzard will cut 775 jobs, about 8 percent of the workforce. The news came following Activision Blizzard's 2018 financial results. Revenue reached $7.5 billion, up 6 percent from $7.02 billion a year earlier. "While our financial results for 2018 were the best in our history, we didn't realize our full potential," Activision Blizzard CEO Bobby Kotick said in the company's earnings report. "To help us reach our full potential, we have made a number of important leadership changes." The cuts will come from non-development teams and support staff, according to an internal letter from Blizzard president J. Allen Brack that was seen by Kotaku. Activision Blizzard didn't immediately respond to a request for comment. In a press release, Activision Blizzard indicated the cuts wouldn't affect the development of new games. The company says it will be adding development staff for its major franchises, such as Overwatch, Call of Duty and Diablo. The increases for those franchises could be in the neighborhood of 20 percent this year. Kotaku reports the letter also promised to cut employees job placement assistance, health coverage and profit-sharing bonuses as part of a "comprehensive severance package." The layoffs follow major changes at the company, which recently spun out Bungie, the team behind Destiny. Infowars and Silicon Valley: Everything you need to know about the tech industry's free speech debate. Cambridge Analytica: Everything you need to know about Facebook's data mining scandal.<doc-sep>
Activision Blizzard employees officially informed of layoffs The rumored layoffs taking place at Activision Blizzard are now official, as employees were informed in an email sent out this afternoon. Activision Blizzard earnings were just made public and many were waiting to what the details would be regarding potential layoffs hitting the massive gaming company. A reporter learned via an internal email that employees were informed this afternoon that staff will be getting cut. Previous reports suggest the company will cut roughly 8% of its workforce. We'll update when official numbers are revealed. Jason Schreier of Kotaku reported on the email, which included this statement from Blizzard President J. Allen Brack. “Over the last few years, many of our non-development teams expanded to support various needs,” Brack said in a note to staff around 1 pm PT that was obtained by the publication. “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.” The move is part of a plan to restructure due to missed expectations for 2018 and lowered expectations for 2019. The letter, as reported, included a promise of a "comprehensive severance package", job placement assistance, continued health benefits, and career coaching. Profit-sharing bonuses for the previous year will also still be given out to the laid-off employees. Activision Blizzard generated $1.79 billion in operating cash for the year ending on December 31, 2018, compared to $2.21 billion for 2017. CEO Bobby Kotick said this in the Activision Blizzard earnings press release: “While our financial results for 2018 were the best in our history, we didn’t realize 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.” The plan for 2019 includes increasing development investment in the biggest Activision Blizzard franchises, "enabling teams to accelerate the pace and quality of content for their communities and supporting a number of new product initiatives." Though there are layoffs taking place, the number of developers working on Call of Duty, CandyCrush, Overwatch, Warcraft, Hearthstone, and Diablo will increase "approximately 20% over the course of 2019". This will likely be the result of restructuring once layoffs are completed. We at Shacknews wish speedy employment to all of those affected by this decision.