Activision Blizzard Job Cuts Might Hurt the Company
Call of Duty publisher Activision Blizzard is warning investors that 800 job cuts could damage the company. The warning comes in the publisher’s latest SEC filing in a new section in its Risk Factors. In particular, the company warns that there are many factors that could affect whether the redundancies will achieve the company’s desired savings.
In another section of the filing, the company also says that it needs to pay pre-tax restructuring charges of around $150 million before the end of the year. This is in large part due to the severance for affected staff and will likely happen in the first quarter of the year.
“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,” the filing reads.
“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 labor 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.”