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Activision Blizzard said that Call of Duty: Black Ops 4 had a strong quarter, outdoing sales of the previous Call of Duty: Black Ops III title from 2015.

But the company acknowledged in an analyst call for its fourth-quarter that Black Ops 4 fell short of the company’s own expectations, particularly in the second half of the fourth quarter.

These lower earnings may be one of the contributing factors for why Activision Blizzard is laying off 8 percent of its workforce, or hundreds of employees. (Likely more than 700 people in non-development positions).

Activision said that Call of Duty “was again the number-one selling console franchise worldwide for the year, a franchise feat accomplished for nine of the last 10 years.” During the quarter, Black Ops 4 units exceeded Black Ops 3 copies sold, and PC units more than tripled. Activision said that the late quarter seasonal content was encouraging.

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Full-game downloads were over 40 percent of Call of Duty: Black Ops 4 console sell-through, versus approximately 30 percent for the prior release, Call of Duty: WWII.

On the call, Activision said that the Call of Duty headcount would increase 20 percent during 2019, particularly as the company shaves back in other areas.

“The Call of Duty performance suggests it won’t be as big of a drop off this year, so their guidance is baffling,” given a forecast of a 13 percent decline in revenue, said Michael Pachter, analyst at Wedbush Securities. “The company’s ‘mistake’ was in staffing up in anticipation of growth, and the growth appears to be elusive. The headcount reductions make sense in that context.”

On the call, Activision Blizzard CEO Bobby Kotick said, “We are excited about the fall Call of Duty content,” meaning the Call of Duty launch for the fall of 2019. The next Call of Duty will also feature a traditional single-player campaign.

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