Activision Blizzard to lay off 800 workers
In anticipation of a sharp downturn in revenue, video game maker Activision Blizzard will be laying off 800 workers. This move comes on the heels of the best year in the company’s history.
Activision is cutting back about eight percent of its total workforce. The company will bear the cost of severance pays and other accounting expenses associated with laying off hundreds of employees amounting to about $150 Mn. Existing workers will be reassigned to work on Call of Duty and Candy Crush which are among its most famous video game series.
The video game industry goes through more frequent boom-and-bust cycles than other sectors. For example, the currently trending game titled Fortnite produced by Epic Games is partly responsible for taking away the attention and sales away from the new games released by other entities such as Activision.
Even after accounting for the revenue expected from Call of Duty and Candy Crush, the company expects revenue to drop by 20 percent. However, the California-based company’s revenue rose by seven percent to $7.5 Bn–the highest so far in the company’s 40-year-old history, according to a media report.
Since this high revenue still fell short of the organization’s expectations, CEO Bobby Kotick said it was crucial for the company’s future to reevaluate priorities and repurpose resources in order to “achieve long-term goals and objectives.”
The development teams will be mobilized to produce “better content” for the franchises at a faster pace to keep up with the changing trends and short-term shelf lives of product in the video gaming industry.