Publisher Activision Blizzard has begun its long-rumoured layoff process, informing employees this afternoon that it will be cutting staff. On an earnings call this morning, the company said that it would be eliminating 8% of its staff.
In 2018, Activision Blizzard had roughly 9,600 employees, meaning nearly 800 people are now out of work.
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 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 organisation. 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.
The news follows months of rumours 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 year, 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.
Blizzard has spent the year taking big measures to cut costs as it prepares for a lean 2019. Those measures, as conveyed by people who work or have worked for the iconic studio, include employee buyouts in which workers are offered money to leave, a broadening of the finance department, and the limitation of budgets for any team at the company that isn’t directly making video games.
“It’s critical that we prioritise 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.”
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 realise 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.”
This is breaking news and will be updated as more information comes in.