Ubisoft execs have explained that sales of Assassin’s Creed Syndicate have suffered because of the negative reaction to last year’s bug-riddled release, Assassin’s Creed Unity. …
Ubisoft has reported weakened sales and a net loss for the first half of its current fiscal year. The company anticipates a significant turnaround heading into the second half of the year, with a heavy release schedule through March 31.
Ubisoft sales for the first half slid 57 percent to €207.3 million ($ 227.8 million), but came in above targets. Ubisoft says that the presence of Watch Dogs in the first half of last year helped push sales significantly higher. The company posted operating losses of €107.8 million ($ 118.5 million) and €65.7 million ($ 72.2 million) in net losses.
The remainder of Ubisoft’s fiscal year includes Assassin’s Creed Syndicate, Just Dance 2016, Rainbow Six Siege, The Division, and Far Cry Primal. It also includes a major expansion for the The Crew, Wild Run. The second half of Ubisoft’s previous fiscal year only included four titles, creating a mis-match when comparing across periods.
Despite the upcoming game releases, Ubisoft does anticipate a decrease in sales during its third quarter of 26 percent. This puts additional pressure on Far Cry Primal and The Division, as Ubisoft anticipates its full-year sales to remain stable year-over-year.
Ubisoft did note that digital revenue is up significantly compared to the first half of last fiscal year. Full game and add-ons sold via digital distribution mechanisms now represent 48.3 percent of total sales, up from 27.8 percent in the same period.
The publisher is also dealing with the initial moves of a hostile takeover. Last month, Vivendi made two unsolicited investments in Ubisoft and now owns more than 10 percent of the company.
Ubisoft needs each of its upcoming games to hit its mark in terms of projected sales and timing. A delay of either Far Cry Primal or The Division would have severe consequences for the full-year outlook. We’ve still not seen much of either, and with the Division, that’s a bit concerning.
As part of its financial report, Ubisoft has updated its breakdown of software sales by platform. Current-gen software has dipped, while PC has grown.
At the halfway point in fiscal 2015 (ended March 31, 2015), Ubisoft’s current-gen software sales amounted to 47 percent (32 percent on PS4, 15 percent on Xbox One, 0 percent on Wii U). That has shrunk to 40 percent, with PlayStation 4 software now representing 27 percent of sales and Xbox One games accounting for 12 percent. Wii U accounts for 1 percent.
This can be attributed to a shift in the schedule, with a major title like Watch Dogs absent from Ubisoft’s year so far. The second half of the year includes six major releases, including Assassin’s Creed Syndicate and The Division.
PC software jumped from 15 percent at the halfway point last year to 20 percent in the current year. Xbox 360 sales have dropped from 14 percent to 10 percent. PlayStation 3 software has declined from 17 percent to 10 percent.
Ubisoft is also posting a significant gain in the “others” category, which is where its mobile titles exist. In the first half of fiscal 2015, that category represented only 6 percent. It now accounts for 18 percent of software sales.
I expect to see significant shifts once third and fourth quarter results are in. Most publishers don’t report breakdowns like this, which is unfortunate as this gives us a snapshot of current-gen uptake and purchase habits.
We’re seeing mounting migration from last-gen consoles, and I suspect the upgrade pace will quicken through the holiday such that by this time next year, last-gen software sales are below 5 percent. This will be driven in part by publisher development migration, but these two factors push each other. More software means more upgrades, which in turn drives publishers to leave last-gen behind.
Vivendi is making a play for seats on Ubisoft’s board. Following acquisition of 6.6 percent of Ubisoft stock earlier this month, the former Activision parent has deepened its investment.
That stake is now 10.4 percent, after another acquisition. At the same time, Vivendi increased its hold on Gameloft (also owned by the family of Ubisoft CEO Yves Guillemot) from 6.2 percent to 10.2 percent.
The total investment is now valued at €438 million ($ 496 million). According to Bloomberg, Vivendi has signaled that it will be seeking seats on the companies’ boards and may further increase its investment in both.
Up until 2013, Vivendi owned Activision Blizzard. A payout of $ 8 billion from corporate coffers and an investor group led by Activision leadership freed the company.
We've reached out to Ubisoft to find out if there is any further reaction to this development. We'll update should we receive a response.
Yesterday, Ubisoft labeled the investment as “unsolicited” with additional color added from emails calling the stock purchase “unwanted.” Today, Vivendi seems to have shot back with an action that speaks louder than words. Ubisoft and Gameloft are likely to start initiating protective measures to safeguard from a hostile takeover.
Earlier this month, former Activision owner Vivendi returned to the gaming sector with two investments. The company purchased 6.6 percent of Ubisoft and 6.2 percent of Gameloft, amounting to a total spend of €160 million ($ 183 million).
In a reported Ubisoft internal memo obtained by GamesIndustry.biz, Ubisoft CEO Yves Guillemot states that the investment was both “unsolicited and unwelcome.” A separate email also obtained by the publication also suggests that Guillemot is concerned that a takeover would bring with it risk of leadership from those that don’t understand Ubisoft or the industry.
When reached for comment, Ubisoft confirmed that Vivendi’s €140 million ($ 159.2 million) investment wasn’t sought after. “We take note of the unsolicited action on the part of Vivendi,” a company representative told us via email. “We reiterate our intention to remain independent, an approach that, since the company’s founding 30 years ago, enabled it to become the third-largest video game developer in the world.”
In 2013, Activision spent $ 8 billion to free itself from Vivendi, raised from a combination of internal reserves and an investor group led by CEO Bobby Kotick and co-chairman Brian Kelly. Subsequently, Vivendi divested itself of another $ 850 million worth of Activision shares in 2014.
An investment of this magnitude without prior communication understandably has Ubisoft on edge. Looking at Vivendi’s most recent financial troubles and how it was preparing to drain Activision’s cash reserves before the split, and you’ll see what might have Guillemot and other Ubisoft leadership on guard.
Ubisoft has announced a change to its uPlay rewards platform that rebrands the service as Ubisoft Club. In addition to the cross-game uPlay points and in-game rewards players can earn, the new program will offer access to betas and more.
A brief trailer that appeared on the uPlay YouTube channel says that players will also be able to earn badges, shop discounts, and limited edition items. Sign-ups will be available on a new Ubisoft Club website, but it isn’t live yet.
(Please visit the site to view this media)
The timing seems to be aligned with the release of Assassin’s Creed Syndicate, which is out this Friday. However, Ubisoft hasn’t yet detailed how and when this transition will be live (or if it is a complete transition from the old uPlay system).
We’ve reached out to the publisher for details. We’ll update should we receive a response.
[Source: uPlay on YouTube]
uPlay means different things depending on which platform you prefer. On console, it’s frequently simply a way to unlock in-game rewards. However, uPlay has caused authentication issues and serves as PC DRM that has frustrated gamers.
Whether Ubisoft Club is simply a rebranding or a new initiative entirely remains to be seen. And, if it is new, we’re curious to find out if the publisher is revising its PC piracy protection strategy.
Ubisoft appears to be in acquisition mode right now, with a second studio purchase announced in the past month. Longtail, the studio behind the Rocksmith franchise, has been acquired by the publisher. It will now be known as Ubisoft Halifax.
While Longtail worked on the most recent Rocksmith title, its pedigree is in another area. The studio’s motto is “serious about casual” according to its website.
Previous titles include Dance on Broadway, Football U, Grey’s Anatomy: The Video Game, and Sports Connection. This brings the total number of Ubisoft studios to 26, with an additional 17 locations that serve as business offices.
Ubisoft announced the purchase of The Crew developer Ivory Tower earlier this month. That studio’s next endeavor, The Crew: Wild Run, is due out on November 7 for Xbox One, PlayStation 4, and PC.
We've reached out to Ubisoft to get a better sense of what types of projects the studio will be working on. We'll update should we receive a response.
Update: In a prepared statement, Ubisoft says that the 30-person team in Halfax will be working on a number of mobile titles. It is currently recruiting for 10 positions to grow its capacity.
Purchasing Ivory Tower made a lot of sense on the surface, but this acquisition is less obvious. Having the studio assist with Rocksmith now that Rock Band and Guitar Hero are back could help Ubisoft keep up (even though its offering is a more instructional product).
Investing in a studio to pump out casual games makes less sense in this environment. Contracting out for that type of project seems less risky.
Former Activision parent company Vivendi got a big payday in 2013 when the Call of Duty publisher bought its independence. The move saved Activision from a potential drain on its cash reserves, but cost $ 8 billion raised from a variety of investors, including a group led by CEO Bobby Kotick.
Now, Vivendi is getting back in the pool. According to Bloomberg, the company has invested in both Ubisoft and mobile publisher Gameloft. Total investments amount to €160 million ($ 183 million), with €140 million ($ 159.2 million) going to Ubisoft and €19.7 million ($ 22.4 million) to Gameloft.
With the $ 8 billion raised from its sale of Activision shares in 2013, another $ 850 million from shares sold in 2014, and other divestments, Vivendi is reportedly sitting on cash reserves of $ 10 billion. This puts it in a significantly healthier position than it was prior to its split from Activision.
Ubisoft and Gameloft are unlikely to find itself in the same position as Activision did. Vivendi currently controls only 6.6 percent and 6.2 percent of shares respectively.
Prior to Activision’s liberation, Vivendi was preparing to drain the publisher’s cash reserves with a special dividend. It was in serious financial trouble at the time, and losing Activision may not have been the desired outcome (though it did ensure the health of both long-term).
This return to gaming is minor enough that it could just be smart, diverse investing. I’m interested to see if Vivendi delves deeper, though.
It's also worth noting that this might be related to Ubisoft's recent acquisitions of Ivory Tower and Longtail, two studios with which it has existing relationships. The publisher could have used Vivendi's money to invest in bringing the studios in-house.
Ubisoft has purchased social and casual game developer Longtail Halifax for an undisclosed fee. …
Gamers who purchased the collector's edition of Might & Magic Heroes VII were disappointed to find a digital download code where they expected a game box to be, among other surprises.
Ubisoft says the mix up was caused by the fact that it mentioned the game was a download while showing an image (above) that referenced a box copy. Gamers have compiled an imgur detailing how a twitch unboxing of the edition by Ubisoft showed a DVD of the game and other apparent visual evidence.
There are also posts on the Ubisoft forum by readers who say they did not receive a soundtrack CD and that there was no digital code in its place.
Here is the statement from Ubisoft on the situation:
Ubisoft regrets any confusion created by the marketing materials from our Might and Magic Heroes VII Collector's Edition. We understand that some customers in North America were not aware the Collector's Edition delivered digital versions of the game and soundtrack. Ubisoft apologizes for any frustration and disappointment resulting from these items being in digital format vs. physical format. We are accepting complete refunds from any dissatisfied customers and will be providing a compensation plan of one complimentary digital PC game for consumers that have already purchased the Might and Magic Heroes VII Collector's Edition from the Uplay shop in North America. Affected consumers will be able to pick one game of their choice from a selection including Far Cry 4, Assassin's Creed Rogue, The Crew, AC Rogue, Toy Soldiers: War Chest Hall of Fame Edition and Zombi.
The Ubisoft store currently shows the correct information.
For more on the game itself, check out Dan's review.
While Ubisoft's admission of a mistake and the ensuing refund are good ways to rectify the situation, I'm curious when and how Ubisoft mentioned to consumers that the picture above was a mistake and that there were only download codes. Plenty of gamers who ordered the collector's edition seem to not have gotten the message.