Blizzard

Activision Blizzard Quarter 4 2018 Earnings Report - 8% of Employees Laid Off in Year of Restructuring

publicado 12/02/2019 a las 15:57 por perculia

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2018 was the most profitable year in the company's history, but they fell short of goals.

Activision Blizzard's net bookings were a record 7.26 billion, up from 7.16 billion in 2017.

Blizzard's Q4 was nuanced, with 35M MAU in the quarter. WoW saw expected declines after the expansion launch, and Blizzard had declines in netbookings for Overwatch and Hearthstone.

Blizzard has a contract with NetEase to publish their games in China through 2023.

2019 forecasts will not assume that Blizzard will improve monetization as 2018 did.

2019 is a transition year with less major content releases than is ideal.

The company will invest more in development. They are also de-prioritizing initiatives that aren't meeting expectations, as well as in administrative areas.

Approximately 8% of staff were laid off.

Warcraft, HS, OW, and Diablo will see an increase of 20% in their development teams in 2019. WoW also has a content pipeline established of regular releases.

Blizzard is investing in more Warcraft games, as well as Esports leagues and partnerships.

Diablo headcount will increase substantially as the team works on more unannounced projects

They are aggressively hiring talent in the upcoming quarters, and scaling the business for future growth.

There are no new major releases for Blizzard in 2019, with the expectations of low financial performance.

Blizzard thinks the pipeline looks promising beyond 2019, on PC, consoles, and mobile.

The increased investment in development meant reducing spending in other areas, which generated the layoffs.

earnings report“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.”For the year ended December 31, 2018, Activision Blizzard’s net bookings were a record $7.26 billion, as compared with $7.16 billion for 2017, below our prior outlook. Net bookings from digital channels were a record $5.72 billion, as compared with $5.43 billion for 2017, and in-game net bookingB were a record of $4.2 billion.

For the quarter ended December 31, 2018, Activision Blizzard’s net bookings were a record $2.84 billion, compared with $2.64 billion for the fourth quarter of 2017, below our prior outlook. Net bookingsB from digital channels were a record $1.88 billion, as compared with $1.62 billion for the fourth quarter of 2017, and in-game net bookingsB were a record of $1.2 billion.In 2019, the company will increase development investment in its biggest franchises, enabling teams to accelerate the pace and quality of content for their communities and supporting a number of new product initiatives. The number of developers working on Call of Duty, Candy Crush, Overwatch, Warcraft®, Hearthstone and Diablo® in aggregate will increase approximately 20% over the course of 2019. 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. The company is also integrating its global and regional sales and go-to-market, partnerships, and sponsorships capabilities. As part of these restructuring actions, the company expects to incur a GAAP-only pre-tax charge of approximately $150 million, the majority of which is expected to be incurred this year.

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