Activision Blizzard shares fell nearly 10% on Friday after the main video game publisher announced a split with “Destiny” creator Bungie.
The publisher “Call of Duty” and “World of Warcraft” has returned the publication rights to the first-person shooter “Destiny” to Bungie.
The division has been filed with the Securities and Exchange Commission. Bungie will now have and develop the Destiny franchise, and Activision will not benefit from the popular title in 2019.
“Destiny 2: Forsaken” did not meet Activision’s sales expectations, but investors may be concerned about the loss of game revenue.
Struggling Performance and Increased Competition
Activision shares had problems in 2018 after previous highs. It faces competition in the growing video game market since the resounding “Fortnite” success of Epic Games in 2018.
Activision also lost its CFO Spencer Neumann to Netflix in early January. Although this was after the termination of the Neumann contract. According to reports, the dismissal was due to “violating his legal obligations with the company.”
Amrita Ahuja, CFO of Blizzard, also left at the same time to take part in the Square payments company. Other reports point to the friction between the Activision and Blizzard staff and the silent cost reduction in Blizzard. A former employee said:
Over the past year, Blizzard has been actively trying to find creative ways to reduce costs that do not catch the attention of the press.
Blizzard responded that it had a “voluntary and long-standing program” for employee departures and continues to hire game developers. However, rumors of 2019 layoffs persist.
The company also faces accusations from a former employee of harassment and discrimination, according to Variety reports. He responded by defending his “inclusive and respectful work environment”.
Epic Games Expected to Earn $3 Billion from 2018 Sales
Despite the growth of the video game market driven by online titles and cross games, Activision Blizzard has had problems. The market is expected to reach a value of more than $ 20 billion by 2020.
Epic Games is expected to earn around $ 3 billion in revenue by 2018, mainly from in-game purchases at “Fortnite”.
Activision Blizzard joins Macy’s, American Airlines and Apple, with a difficult start to 2019.