Ubisoft Warns of More Losses Following Record €1.3 Billion Operating Setback
By Leo Marchandon and Zakarya Meliani
Ubisoft Faces Ongoing Financial Challenges and Restructuring
May 20 (Reuters) - French videogame publisher Ubisoft warned on Wednesday of another year of losses and lower sales after a record annual operating loss, deepening pressure on the company as it restructures.
Record Operating Loss and Declining Sales
The company reported an International Financial Reporting Standards operating loss of 1.3 billion euros ($1.40 billion) for the year to March 2026, which Chief Financial Officer Frederic Duguet said on a press call was a record. Net bookings fell 17.4% to 1.53 billion euros.
Sales Outlook and Profit Recovery Plans
Ubisoft said sales in 2026-27 would fall by about 8% to 9%, with a high single-digit operating loss margin and cash burn of as much as 500 million euros. It said it expected to return to profit and positive free cash flow in 2027-28 on a stronger release slate and growth in live-service, online multiplayer games meant to keep players spending overtime like Riot Games "League of Legends".
Restructuring Efforts and Financial Stability
Ubisoft has been under pressure following weak game launches, delays and a January restructuring that pushed its shares lower. The company said it had enough cash for near-term debt repayments and was in talks with lenders to refinance upcoming maturities.
Management Changes and Strategic Partnerships
Ubisoft also announced a management addition tied to its biggest franchises.
Nicolo Laurent Joins Vantage Studios
Nicolo Laurent, the former chief executive of Tencent-owned Riot Games, will join Vantage Studios, a Tencent-Ubisoft venture handling Ubisoft's largest brands, as a special adviser.
Upcoming Releases and Cost-Cutting Measures
Ubisoft also said first-quarter net bookings would be about 250 million euros, ahead of the release of "Assassin's Creed Black Flag Resynced," a remake of its 2013 Caribbean-set hit.
Job Cuts and Expense Reduction Targets
The publisher cut about 1,200 jobs over the past year, leaving it with about 16,600 staff, and reduced fixed costs by 118 million euros to 1.435 billion euros in 2025-26. It is targeting a further cut to 1.25 billion euros by March 2028 as it tries to stabilise cash flow.
(Reporting by Leo Marchandon and Zakarya Meliani in Gdansk; Additional reporting by Coralie Lamarque; Editing by Matt Scuffham)
