Although the year is young, 2019 hasn’t been particularly kind to Activision Blizzard. With the departure of a number of executives, stock price dropping, an investigation for possible fraud, and Blizzard recently admitting that it doesn’t have any big releases plans for 2019, things have not gone according to plan for the massive company. Arguably the biggest news in 2019 was the sudden and abrupt end to the Activision and Bungie for Destiny and now fans have a few details on why that split occurred.
As part of Activision Blizzard’s earnings call this week, President and Chief Operating Officer Coddy Johnson discussed the split between Activision and Bungie and admitted that the leadership team is confident that it was the right decision. Unsurprisingly, the main reason why Activision decided to end the 10-year contract early was that the Destiny franchise as a whole was failing to meet its commercial projections, even though it was a critically acclaimed, high-quality series. These statements line up with comments Johnson made last year regarding the disappointing sales numbers of Destiny 2 Forsaken.
Interestingly enough, Johnson also revealed that Activision Blizzard first learned in November 2018 that Bungie was interested in getting out of the publishing deal. The separation was actually completed in late December, before being publically announced in early January. As Johnson put it, ending the deal was amicable on both sides and ultimately allows Bungie to continue focusing on the IP that they originally created while freeing up Activision and its considerable resources to focus on more opportunities for its current its franchises.
While the Activision/Bungie split was a big talking point, the earnings call also confirmed the rumors that the company would be laying off a large portion of its staff. Despite announcing that 2018 was a record-breaking year for the company, Activision Blizzard is cutting costs and reducing its global staff by 8%, which translates to nearly 800 employees. The news comes at a tumultuous time following previous announcements such as the increased paid dividends to shareholders by nine percent and new CFO, Dennis Durkin, getting a $15 million signing bonus earlier this year.