A player uses a PS4 controller while playing the new video game Ubisoft Watch Dogs Legion on October 28, 2020.
Kenzo Tribouillard | AFP through Getty Images
LONDON – Ubisoft shares fell 6% on Wednesday morning, despite French video game giant reporting record quarterly sales. The company has also tightened its guidelines for the entire year.
Ubisoft recorded sales of 1 billion euros ($ 1.2 billion) in the third fiscal quarter, exceeding its own target and more than doubling the 455.5 million euros in sales that the company has reserved in the same period now one year.
The company said it has benefited from a strong list of new titles, including Just Dance 2021, Assassin’s Creed Valhalla and Watch Dogs: Legion. The strong performance was also helped by the momentum for the new generation consoles from Sony and Microsoft, launched in November.
Ubisoft said its Assassin’s Creed game Valhalla had record franchise sales and was the second best-selling game on PlayStation 5 and Xbox Series X and S. Watch Dog: Legions was the fourth best-selling title on the franchise. state-of-the-art platforms, Ubisoft said.
But it’s not just new and older versions that drive Ubisoft sales. Ubisoft CEO Yves Guillemot said in the company’s earnings call that he saw “a strong commitment” in his games catalog, adding that this trend continued in January.
Rainbow Six Siege, a first-person shooter game released by Ubisoft in 2013, now has 70 million players, said CFO Frederick Duguet. This represents an increase of 15 million users compared to last year. Rainbow Six Siege is a popular title in esports tournaments.
“In a context of growing engagement and strong industry trends, the first nine months of the year confirmed that we continue to move toward a sharper recurrence of our revenue,” Guillemot said at the launch of Ubisoft in the quarter three of the revenue, Tuesday night.
“Therefore, we expect our highly profitable catalog to be an even bigger part of our business in the future.”
It’s a sign that the video game industry is moving toward games with a longer lifespan and recurring revenue, rather than relying solely on hit hits.
Video game companies have benefited greatly from the coronavirus pandemic, as people spend more time at home due to public health restrictions around the world.
On Tuesday, Ubisoft narrowed its year-round guidelines for revenue and profit. The company said it now expects net sales of 2020/21 of between € 2.22 billion and € 2.28 billion, compared to the € 2.2 billion to € 2.35 billion it had previously expected; and operating income from 450 to 500 million, tighter than the previous target of 420 to 500 million euros.
Ubisoft added that it is in the “early stages” of developing a new Star Wars game after announcing an agreement with the Disney division of Lucasfilm Games. The move marks the beginning of the end of a long-running exclusivity agreement between Lucasfilm Games and Electronic Arts.
EA announced on Monday that it will buy mobile game developer Glu Mobile for $ 2.4 billion. Asked if Ubisoft will explore mergers and acquisitions to fuel future growth, Guillemot said the company’s approach was primarily to buy new technologies, rather than content.
Ubisoft has not yet made a decision to raise the price of its video games to a new standard of $ 70, Guillemot said on Tuesday. Large publishers, such as Take-Two Interactive, have $ 10 hiking games priced for state-of-the-art consoles. This is the first time that there has been a major increase in prices in blockbuster games since 2005 and many industry figures say that a long time has passed.