Activision Blizzard released its financial results on Tuesday. This includes the July discrimination and harassment lawsuit filed in California and the immediate aftermath. Investors will be able to see that although the company’s revenue outlook is lower than expected, it still beat its third quarter forecast of $2.07 Billion. This is a result of Diablo 2: The Resurrected improving year-over year.
Finances seemed like a secondary topic on the call, but Activision Blizzard leaders reiterated their plans to improve recruiting and HR practices and shocked employees by announcing that Jen Oneal, a Blizzard leader, was stepping down. It was a shock and, according to some, has hurt morale at Blizzard as it was improving.
Activision Blizzard finally answered the July walkout-organized list of demands last week. Partly, the company accepted the demand to eliminate mandatory arbitration from employment contracts and agreed to strike it for individual sexual harassment or discrimination claims. Activision Blizzard also promised greater transparency in pay, diversity-friendly recruiting policies, and a zero tolerance harassment policy. This will lead to immediate dismissal and forfeiture of future compensation.
PC Gamer was told this week by an insider at Activision Blizzard that they had received a positive response to the announcement last week. Although the timing of the announcement was questionable, the demands were made just in time for Tuesday’s investor conference to become hot topics. However, the partial victory on arbitration was considered a significant accomplishment. The diverse policies that Activision Blizzard has been using to recruit are examples of what each team has already implemented without waiting for a corporate mandate. The absence of third-party oversight over hiring and HR practices is still a concern. However, the mood leading to the earnings call was much better than it was after a mistrusted email from Fran Townsend in October.
According to an employee, Oneal’s announcement that he is leaving as Blizzard leader has “killed” any morale boost that was provided by last week’s concessions. Mike Ybarra and Oneal replaced J Allen Brack as Blizzard boss in August, following the California lawsuit. Ybarra now serves as the sole leader of Blizzard, following Oneal’s resignation.
Oneal’s leadership was a reason for many to believe in a brighter future for Blizzard. Oneal’s sudden departure has left them wondering, and leading to speculation that there is something else.
Oneal wrote to employees, “I am not doing this because I am without hope of Blizzard. This energy has inspired me and motivated me to explore ways I can make games and diversity more interconnected, and hopefully make an industry impact that will benefit Blizzard and other studios.
Amy Dunham, a former Blizzard technical director, also announced her resignation this week. She pointed out that Blizzard’s three most senior women left this year.
She wrote that she had to figure out why senior women leave before making commitments to recruiting more women (usually at entry-level, where people have fewer options than others) and then make the necessary changes.
There have been a few other resignations over the past three months, along with more than 20 departures due to HR investigations and stricter policies. According to Tuesday’s earnings reports, the bottom line is stable for now. Call of Duty users are holding steady on console and PC, while Call of Duty Mobile has experienced “double digit growth” in the West with a significant jump in revenue. Blizzard saw a 20% increase in revenue year-over year due to Diablo 2: Resurrected. Hearthstone continues to enjoy steady popularity and World of Warcraft is on track to have its best year since 2000.
While Call of Duty: Vanguard is out this month, and the next major Warzone update in December, it was revealed that the earnings call will reveal that the next two major games from Blizzard will take longer than anticipated: Overwatch 2 & Diablo 4 don’t have public release dates. However, we were able to learn that their internal development timelines had been extended.
Activision Blizzard partly attributed delays to departures of top company executives. Louis Barriga, the Diablo 4 game director, left the company following July’s allegations. However, a corporate statement about providing a “safe, productive work environment” suggested a connection. Chacko Sonny, Overwatch’s executive producer, left Blizzard in September, unrelated to the lawsuit. Jeff Kaplan, Overwatch director, also left Blizzard back in April.
Activision Blizzard isn’t new to attrition. A former employee told PC Gamer recently that they saw waves of employees leave voluntarily, along with the 2019 and 2020 layoffs. Other long-term effects of the recent high turnover rate at the company may be evident beyond the Diablo 4 and Overwatch 2 delays.
Activision Blizzard CEO Bobby Kotick said Tuesday that “our opportunities for growth are never better” but that they won’t be capable of realizing all those growth potentials without talent. We must be known as the best place to work in order to attract and retain the talent we need. This requires us to create an environment that is welcoming and inclusive.
Kotick stated that the changes and initiatives made so far are only the beginning of the company’s plans. Employees and shareholders will be provided with quarterly updates about progress.