Activision Blizzard Says Job Cuts Might Negatively Impact Future Business, And The Sky Is Blue

Activision Blizzard fears their recent layoffs could have a negative impact on the company going forward, and they'd be right to think so. Why shouldn't they, especially given that the announcement came along with a report that they had enjoyed a "record year?"

Last month, the video game developer revealed that they were cutting their workforce by eight percent, and it really didn't seem like they needed to. The company's CEO, Bobby Kotick, was even featured in a report detailing the 100 most overpaid CEOs for 2019, and it is forecasted that he will make around $28,698,375 this year, a sum that would have him rubbing shoulders with elite NBA players on max deals.

The company, popular for titles such as Call of Duty and Crash Bandicoot, expect that productivity and morale could drop while other employees could leave after their decision to take away 800 jobs. They've already allocated $150 million as compensation for the workers who were let go, which makes for additional expenditure.

"In February 2019, we announced a restructuring plan under which we plan to refocus our resources on our largest opportunities and to remove unnecessary levels of complexity and duplication from certain parts of our business," Activision states in its annual report 10-K filing with the United States Securities and Exchange Commission, in which they're obligated to warn investors of potential risks that could affect financial performance.

RELATED: Blizzard Has No Major Games Coming Out In 2019

via game-insider.com

"While we believe this restructuring plan will enable us to provide better opportunities for talent, and greater expertise and scale on behalf of our business units, our ability to achieve the desired and anticipated benefits from the restructuring plan within our desired and expected timeframe is subject to many estimates and assumptions, and the actual savings and timing for those savings may vary materially based on factors such as local labour regulations, negotiations with third parties, and operational requirements. These estimates and assumptions are also subject to significant economic, competitive and other uncertainties, some of which are beyond our control.

Further, there can be no assurance that our business will be more efficient or effective than prior to implementation of the plan, or that additional restructuring plans will not be required or implemented in the future. The implementation of this restructuring plan may also be costly and disruptive to our business or have other negative consequences, such as attrition beyond our planned reduction in workforce or negative impacts on employee morale and productivity, or on our ability to attract and retain highly skilled employees. Any of these consequences could negatively impact our business."

The word "Duh" comes to mind here.

Anyhoo, there have been calls for Kotick's resignation since he announced the layoffs and appeared in the list of overpaid CEOs. We doubt that's going to occur, yet stranger things have happened.

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