Ubisoft Initiates Internal Review Amid Ongoing Challenges

Ubisoft has announced a thorough examination of its internal practices in a bid to address the issues that have plagued the company in recent times. This initiative aims to uncover the root causes of its recent struggles and to pave the way for improvements.

As of late 2023, Ubisoft remains one of the world’s top 15 largest video game publishers by revenue. However, despite its significant market presence, the company has faced numerous hurdles, including extended development timelines and project delays. These factors culminated in a staggering loss of over $530 million for the fiscal year 2023, a record shortfall that further depressed its already declining stock prices. Ubisoft’s shares currently sit at a decade-low €11.42, representing a decline of more than 83% compared to five years ago.

Focusing on a Player-Centric Approach

The ongoing difficulties have prompted Ubisoft to postpone the release of Assassin's Creed Shadows until 2025. The publisher describes this decision as part of its commitment to enhancing a "player-centric approach" that prioritizes feedback from its fanbase. Consequently, this shift has led to revised financial targets for the current fiscal year, which were disclosed on September 25.

In the same investor update, Ubisoft revealed the launch of an internal investigation aimed at evaluating its practices and how they contribute to its current challenges. The statement noted that "the Executive Committee, under the guidance of the Board of Directors, is initiating a review to enhance our execution, particularly concerning this player-centric approach, and to accelerate our strategic transition towards a higher-performing model," ultimately benefiting shareholders.

Disappointing Q2 Performance

The statement also highlighted that Ubisoft’s performance in the second quarter of this year fell below expectations, prompting the internal investigation and an extended timeline to ensure Assassin's Creed Shadows launches as a top-quality product. As for its third-quarter results, expectations are low, especially after Ubisoft confirmed that Star Wars Outlaws did not meet its initial sales projections.

Despite these challenges, CEO Yves Guillemot affirmed that these changes will not shift the company’s overarching focus on open-world experiences and the live-service business model. The 2023 strategy to prioritize Assassin's Creed remains firmly in place for the time being.

Notably, the changes will affect the finer points of Ubisoft’s game development approach. The company has announced a shift away from the traditional season pass model toward a more flexible system. In this vein, all pre-orders for Assassin's Creed Shadows are being refunded, and Ubisoft plans to offer the game’s first expansion free to anyone who purchases it during the second pre-order phase, which has yet to be announced.