Activision-Blizzard, which is currently being sued by the state of California under accusations of a "frat boy culture" and sexual harassment, had an earnings call today, during which it held the usual Q&A session for investors to talk to company leadership. But the majority of those who spoke during this session used that time on other topics, such as Call of Duty, China gaming regulations, and mobile advertising.
In the Q&A segment, only two people asked questions about the ongoing lawsuit and subsequent reports of further harassment and toxic culture at the company. The first asked what the company was doing to address the current issues, and if there would be any impact on the company's productivity or game pipeline.
In response, COO Daniel Alegre reiterated prior statements by the company given earlier in its earnings call. He mentioned the investigative law firm the company has hired (which an employee coalition has rejected due to numerous cited conflicts of interest with management), a commitment to hiring diverse candidates that he says the company has always had, and the replacement of Blizzard president J Allen Brack with co-leaders Jen Oneal and Mike Ybarra announced earlier today. Alegre did not offer new specifics as to how it would address the numerous allegations against it, adding only that the company's game pipeline was "progressing well" and plugging some upcoming new titles.
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The investor question that followed this about the global reopening following COVID-19 lockdowns (which the asker opened with "Nice quarter!"). Following this, a second investor brought up the lawsuit, addressing a question to Oneal and Ybarra on how they plan to rekindle Blizzard pride, as well as a follow-up to the previous response on pipelines suggesting that it seemed hard to believe low morale wouldn't impact game production.
Ybarra did not respond to the question. Oneal did, by focusing on how great the company's progress on Overwatch 2 and Diablo has been. "There's a lot of work ahead of us but the passion and productivity are already here, and when our people feel safe and supported, the rest is going to take care of itself," she said before Blizzard co-founder Allen Adham stepped in to add his own statement about how great Blizzard has always been for 30 years, and how excited he was about upcoming games.
From that point on, no one mentioned the lawsuit. Earlier on the call during the prepared remarks, multiple leaders had warned that if Activision-Blizzard continued to experience "prolonged periods of adverse publicity, significantly reduced productivity or other negative consequences relating to this matter, our business likely would be adversely impacted." And there was an expected, opening statement at the top of the call largely reiterating CEO Bobby Kotick's letter on the matter from last week.
[ignvideo url="https://www.ign.com/videos/2021/07/22/dont-publish-activision-blizzard-sued-by-california-over-allegations-of-frat-boy-culture-and-sexual-harassment-ign-news"]But apart from the two listed above, Activision-Blizzard only had to field normal earnings call questions about Call of Duty and its mobile counterpart, China's gaming restrictions, Apple's ecosystem, and mobile advertising. As far as the lawsuit went, the company's shareholders (or at least those on the call) seemed satisfied. At least one other shareholder isn't, as the company is now facing a second lawsuit seeking class-action status accusing Kotick and other leaders of negligence in managing the company, allowing the culture to get to the point of the California suit and hurting share values.
Activision-Blizzard stock jumped in after-hours trading from a low today of $77.81 per share to $84.75 per share at the time this piece was written. Share prices were consistently above $91.00 per share for months before the lawsuit's filing and remained steady for several days after, not dropping until a series of continued reports and accusations detailing a toxic culture of harassment and lack of accountability dropped in the following week.
[poilib element="accentDivider"]Rebekah Valentine is a news reporter for IGN. You can find her on Twitter @duckvalentine.
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