Restructuring

9 Months Ended

Sep. 30, 2021

Restructuring and Related Activities [Abstract]

During 2019, we began implementing a plan aimed at refocusing our resources on our largest opportunities and removing unnecessary levels of complexity from certain parts of our business. We have been:

•increasing our investment in development for our largest, internally-owned franchises—across upfront releases, in-game content, mobile, and geographic expansion;

•reducing certain non-development and administrative-related costs across our business; and

•integrating our global and regional sales and “go-to-market,” partnerships, and sponsorship capabilities across the business, which we believe will enable us to provide better opportunities for talent and greater expertise and scale on behalf of our business units.

To date, substantially all actions under our plan have been accrued for, with remaining activity primarily being related to cash outlays to be made to impacted personnel.

The following table summarizes accrued restructuring and related costs included in “Accrued expenses and other liabilities” and “Other liabilities” in our condensed consolidated balance sheet and the cumulative charges incurred (amounts in millions):


	Severance and employee related costs		Facilities and related costs		Other costs		Total
























Balance at December 31, 2020	$	88	$	—	$	3	$	91
Costs charged to expense	24		1		2		27
Cash payments	(9)		—		(1)		(10)
Non-cash charge adjustment	(2)		(1)		(1)		(4)
Balance at March 31, 2021	$	101	$	—	$	3	$	104
Costs charged to expense	3		12		2		17
Cash payments	(11)		—		(2)		(13)
Non-cash charge adjustment	—		(12)		—		(12)
Balance at June 30, 2021	$	93	$	—	$	3	$	96
Costs charged to expense	1		2		1		4
Cash payments	(17)		—		(1)		(18)
Non-cash charge adjustment	(1)		(2)		—		(3)
Balance at September 30, 2021	$	76	$	—	$	3	$	79

Cumulative charges incurred through September 30, 2021	$	180	$	50	$	37	$	267

Total restructuring and related costs by segment are (amounts in millions):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Activision	$	—	$	1	$	1	$	5
Blizzard	4		7		42		30
King	—		1		1		(1)
Other segments (1)	—		—		4		2
Total	$	4	$	9	$	48	$	36

(1)Includes charges outside of our reportable segments, including charges for our corporate and administrative functions.

During the three and nine months ended September 30, 2021 and 2020, we incurred additional restructuring charges and adjustments that are not included in the plan discussed above. Such amounts were not material.

We have substantially completed our accruals for all actions under the plan. The charges associated with the plan primarily relate to severance and employee-related costs (approximately 65% of the aggregate charge), facilities and related costs (approximately 20% of the aggregate charge), and other costs (approximately 15% of the aggregate charge), including charges for restructuring-related fees and the write-down of assets. A substantial majority (approximately 75%) of the total pre-tax charge associated with the restructuring is expected to be paid in cash using amounts on hand, and such cash outlays are largely expected to be completed within the next 12 months. We do not expect to realize significant net savings in our total operating expenses as a result of our plan, as cost reductions in our selling, general, and administrative activities are expected to be offset by increased investment in product development.

The total charges incurred through September 30, 2021, and total expected pre-tax restructuring charges related to the plan, by segment, inclusive of amounts already incurred and inclusive of certain inventory write-downs in prior years, are presented below (amounts in millions):


	Total charges incurred through September 30, 2021		Total charges expected as of September 30, 2021
Activision	$	33	$	33
Blizzard	186		187
King	20		20
Other segments (1)	33		35
Total	$	272	$	275

(1)Includes charges outside of our reportable segments, including charges for our corporate and administrative functions.