The Strategist

Activision cuts staff

02/14/2017 - 16:05

Activision Publishing, belongs to Activision Blizzard, dismissed a number of its employees. The layoffs were held in studios Infinity Ward, Beenox, and others, which names were not disclosed.

Tarcil Tarcil
Tarcil Tarcil
This event may seem strange, given Activision Blizzard’s recent very positive report, which stated that the company set another all-time record for profits in the previous 12 months. The report said that Blizzard Entertainment and the MLG, both owned by Activision Blizzard, were not affected. Activision Publishing laid off about 5% employees in total. 

Activision Publishing is a division of Activision Blizzard, headquartered in Santa Monica (California, USA). It includes a number of studios, located in North America, such as well-known Infinity Ward, Beenox and Treyarch.

Information about the staff cuts came shortly after publication of the financial report. Activision’s Executive Eric Hirshberg made it clear that the company is dissatisfied with sales of Call of Duty: Infinite Warfare. The Infinity Ward, developer of Infinite Warfare, dismissed about 20 people.

Activision was not at its best when performing its main task in the last year. The company’s key product, Call of Duty Infinite Warfare, sold millions of copies, yet the final result still proved to be insufficient. Even the company itself admitted that Infinite Warfare’s players deceived expectations of gamers, and, as a consequence, is not being sold well. This resulted in a decision to return to origins of the series.

The situation could be even worse without Blizzard, which saved the show last year. The studio came up with new mega shooter Overwatch, which almost instantly became the studio’s fastest-selling game, and a few months later earned the title of the most successful project in Activision Blizzard’s history.

According to statistics, the holding company earned 6.608 billion dollars last year. 39% of revenue came from Blizzard Entertainment, Activision earned 36%. The remaining 25% were received from activities of King studio, author of Candy Crush, purchased a few years ago. 

There is one more interesting thing - according to statistics, income from sales of in-game content (containers, boxes, etc.) increased by 125% in 2016 compared to 2015.

Previously, Activision Blizzard presented its financial results for the three months ending on 31 December.

According to the company’s report, net profit increased by 60% yoy and amounted to $ 254 million, while earnings per share increased by 57% yoy to 33 cents. Adjusted profit was at the level of 92 cents per share, while analysts expected 73 cents per share.

Revenues in the reporting period increased by 49% yoy to $ 2.01 billion, while adjusted revenue was $ 2.45 billion, exceeding analysts' forecasts of $ 2.35 billion.

Speaking about the mobile market, the publisher stressed that active users of King studio’s games are now spending more time in the games. Amount of money received from one gamer, has been growing for six fiscal quarters.

The company also reported a doubling of spectators at Major League Gaming’s platforms, acquired in 2016. Gamers spent 43 billion hours playing games and watching broadcasts of Activision Blizzard. These figures are comparable to Netflix and a half times higher than time spent by users on Snapchat.