Game maker Activision Blizzard responded to what it termed a dissatisfying 2018 by announcing plans to lay off around 775 employees, though it will also boost the number of developers working on its most lucrative titles.
The company reported a profit of $650 million in 2018, overturning a loss of $584 million in 2017. Revenue rose 17 per cent to $2.38 billion.
CEO Bobby Kotick explained on an earnings call that while the company had “record financial results in 2018” it didn’t “achieve the reach, engagement and player investment goals we set for ourselves.”
What’s more, its outlook for 2019 was rather bleak. As COO Coddy Johnson pointed out, the company will not improve in-game monetisation as quickly as it would like, and will release less new content than expected.
Johnson added the company’s restructuring plan “sheds investment and less productive non-strategic areas of our business and will result in a net headcount reduction of approximately 8 per cent, while also driving a significant increase in investment, focus and capabilities around our biggest franchises.”
The company stated it will be “de-prioritising initiatives that are not meeting expectations and reducing certain non-development and administrative-related costs across the business.”
It also plans to invest in its popular franchises. The number of developers working on Call of Duty, CandyCrush, Overwatch, Warcraft, Hearthstone and Diablo “in aggregate will increase approximately 20 per cent over the course of 2019,” it said in a statement.
Some observers have pointed out the immense popularity of Fortnite, a title by Epic Games, has hit the bottom line of other game makers including Electronic Arts and Take-Two.
Activision Blizzard has also suffered from the departure of executives, including CFO Spencer Neumann, who joined Netflix, and the CFO of its Blizzard Entertainment subsidiary, Amrita Ahuja.Subscribe to our daily newsletter Back