SEC opens investigation into Activision Blizzard

Dan Howley joins Brian Sozzi, Julie Hyman, and Emily McCormick to break down the SEC's investigation into Activision Blizzard's workplace environment after the company suffered allegations of sexual misconduct and workplace discrimination.

Video transcript

- And just quickly here. Not hurting Facebook. But there's another scandal in another company. A little more clear cut here.

The SEC looking into Activision Blizzard's alleged abuses in terms of-- of workplace practices.

- Yeah, so the SEC here now is joining in on the fun with Activision Blizzard and fun I guess. The California, obviously, and they're Equal Employment office is looking at the-- the company basically saying, you know, did you people know about complaints about sexual harassment, gender discrimination, racial discrimination?

That's a charge that's been leveled at the company. That's an ongoing investigation. Activision Blizzard had said that, that was, you know, essentially preposterous when those accusations came forward. Then they had to walk that back because there were employee walkouts. Because people had said no, this is the case at this company.

It really appears to be on the Blizzard side is what the-- the vast majority of reporting has shown. But now the SEC is looking into them and saying, you know, did you disclose this to your investors? Did you make the appropriate reporting?

And so that could really be a big problem for Activision Blizzard. We're also looking at the potential for them to be settling another discrimination action. So this is a company that's really under siege at this point.

And you know, now, CEO Bobby Kotick is being looked at by the SEC to determine what he knew, they're looking at employee records. So it appears that Activision Blizzard is going to be facing this kind of problem for quite some time.

And how exactly that impacts the company overall that remains to be seen? You know, they are still releasing games. They're still working on games.

But an action like this could have serious implications for not only, you know, the stock price and the company itself, but its output. So if they are fully distracted by this, then they could end up suffering as far as release dates go for games. And that could just compound the problems for the company overall.

- All right. Dan Howley Yahoo Finance tech editor, thank you so much for breaking down the latest on both of those companies for us.