Ubisoft on the verge of collapse. The gaming industry giant is fighting for survival
Ubisoft is struggling with a serious financial crisis. Falling shares, controversies and player dissatisfaction threaten the existence of the French giant.
French video game tycoon, responsible for such hits as Assassin’s Creed, Far Cry Whether Raymanis facing a serious financial crisis. According to reports from the “ithardware” magazine, Ubisoft’s situation is alarming: the company’s net debt reaches EUR 1.4 billion, and its cash reserves have decreased to EUR 932 million.
Dramatic declines in the stock market
Ubisoft is also recording dramatic declines in the value of its shares – over the last five years, their valuation has decreased by 80%, reaching the level of EUR 12.3. These problems are compounded by controversies surrounding the studio’s latest releases, which were met with a wave of criticism from gamers.
An example is Star Wars Outlawsthe premiere of which caused a storm related to the presentation of a non-binary character. Recipients accuse the studio of duplicating patterns in games that have built the company’s success for years, but now bring more harm than benefits. Series Assassin’s Creed Whether Far Cry is famous for its gameplay based on discovering maps by conquering towers – a mechanism that, in the opinion of players, has already become overused.
Effect? Decreased interest in new Ubisoft titles and a dramatic decline in the value of the company’s shares, for example after the announcement of the delay in the game’s release Assassin’s Creed Shadows. Then the prices dropped by as much as 17%.
Difficult financial situation and restructuring
Ubisoft is taking rescue measures, planning restructuring and layoffs that will cover a significant part of the 19,000-person team. Maintaining such a large staff costs EUR 767 million annually – an amount that the company can no longer bear in the current conditions.
Ubisoft’s crisis is further deepened by the plans of its competitors. Next year, the gaming industry will witness the premiere of long-awaited hits from such giants as CD Projekt, Naughty Dog and Rockstar Games. In the face of such strong rivals, the French studio must not only regain financial stability, but also rebuild players’ trust.
Ubisoft faces a difficult challenge – if it fails to implement effective reforms, the company may not survive in a market dominated by dynamically developing rivals. For one of the oldest and most recognizable players in the video game industry, this is a key moment that will determine his future.
