UBISOFT COMUNICA I DATI RELATIVI AGLI UTILI DELL’ANNO 2023-24

Net booking annuale e del Q4 da record

Utile operative FY24 non-IFRS di €401m, in linea con l’obiettivo

Programma di riduzione costi in corso

Crescita solida attesa per FY25 con una forte pipeline:
Star Wars Outlaws^™ e Assassin’s Creed^® Shadows,
due dei titoli più attesi dell’anno

Focus strategico concentrato su due verticali:
Avventure Open World e Games-as-a-Service nativi

Di seguito i dettagli:

Record annual and Q4 net bookings

• Improving activity metrics: 138m unique active users on Console & PC, up 4% YoY and total hours played up 12% YoY, with a higher PRI per hour.
• Rainbow Six^® and Assassin’s Creed^® franchises both achieved very strong net bookings growth and each benefited from solid fan bases of above 30m unique active players.
• Back-catalog outperformance notably driven by the stellar Rainbow Six^® Siege performance.
• Return to a strong sequence of quality releases designed to be long term sellers.
• B2B partnerships on back-catalog that are incremental to the lifetime value of the titles as well as on streaming, including licensing the Activision Blizzard streaming rights on a non-exclusive basis.

On track to reach the annual €200m cost reduction objective by FY26: Around €150m fixed cost base reduction in FY24.

FY24 in line with targets: Non-IFRS operating income of €401m and €91m non-IFRS Cash Flow from Operations.

Strong 2024-25 line-up: Assassin’s Creed^® Shadows, Rainbow Six^® Mobile, Star Wars Outlaws^™, The Division^® Resurgence and XDefiant. Ubisoft Forward will take place on June 10 and will provide updates on the upcoming releases.

2024-25 targets: Solid net bookings growth, slight increase in non-IFRS operating income and growing non-IFRS Cash Flow from Operations leading to positive Free Cash Flow.

Strategic focus reinforced on two pillars, playing to Ubisoft’s strengths with the objective of driving profitable growth and sustainable recurrence: 1/ Regain leadership in Open World Adventures and 2/ Expand footprint on Games-as-a-Service (GaaS)-native experiences, by leveraging ongoing efforts on proprietary cutting-edge technologies as a differentiating factor.

Strategic focus sharpened on two core verticals: Open World Adventure and native Games-as-a-Service

In FY24, we realized initial returns from our ongoing transformation, advancing on our strategy to expand the global reach of Ubisoft’s biggest brands and enhance our recurring model through long-lasting Live games.

As a result of detailed market analysis as well as a pragmatic and more selective organic investment strategy, we have made the choice to play to our strengths and are sharpening our strategic focus on two verticals, Open World Adventures[1] and GaaS-native[2] experiences. This focus not only offers profitable growth and recurrence prospects but also allows us to leverage and better cross-fertilize Ubisoft’s established brands as well as ongoing targeted investments in proprietary technologies to reach and sustain a competitive advantage.

The first objective is to return to leadership in the Open World Adventure segment, which are immersive worlds with a rich lore that deeply engage players. The Open World Adventure market represents €25 billion today, and is expected to grow over the coming years. This market is dynamic, frequently benefiting from technological disruptions and is characterized by high barriers to entry. Ubisoft can rely on big franchises such as Assassin’s Creed, Far Cry^®, The Division^®, Ghost Recon^® and Star Wars to address this market. This will start in FY2024-25 with the launch of Star Wars Outlaws and Assassin’s Creed Shadows and will continue in the future years as we deliver immersive experiences that attract more players into our universes and reach new audiences, notably thanks to multiplayer and mobile.

The second objective is to expand our footprint on GaaS-native experiences. Historically one of the major segments in the video game industry, it currently represents €120 billion, is a growing market and has the largest total addressable market in terms of number of players. In this segment, Ubisoft has notably successfully installed Rainbow Six Siege, which became one of our largest and most profitable games. The objective is to expand our footprint in this dynamic market notably thanks to growing existing experiences as well as the upcoming releases of XDefiant, Rainbow Six Mobile and The Division Resurgence.

We are fully convinced that our proprietary cutting-edge technologies will provide critical competitive advantages in these two core verticals, driving not only efficiency but also differentiation. Ubisoft has always been a technologically forward-looking company and has significantly revamped its operating model in recent years through a dual approach.

First, we have streamlined, consolidated and mutualized our tech assets to achieve economies of scale. Notably, we have rationalized the branches of Ubisoft Anvil and Snowdrop, our proprietary game engines, converging on just two reference branches shared among our games in production, enabling our teams to focus on breakthrough innovations and facilitating sharing across studios. The impacts will notably be visible this year with the releases of Star Wars Outlaws and Assassin’s Creed Shadows.

Second, we continued to invest in the potential of new technologies that can open new frontiers for creativity and players’ experience, especially Generative AI. Notably, at GDC 2024, Ubisoft unveiled NEO NPC, our first player-facing Generative AI prototype. It is designed to transform the way players interact with non-playable characters and create more immersive gameplay experiences. And beyond several ongoing internal projects, Ubisoft also partners with leading AI companies on joint initiatives.

Q4/FY Highlights

Back-catalog

In its 9^th year, Rainbow Six Siege strengthened its leadership in the highly competitive first-person shooter Live services landscape with impressive and sustained numbers throughout the year. Overall, net bookings grew more than 50% this year. The game boasts excellent results in terms of acquisition, activity, viewership and monetization this year, notably with session days growing significantly year-on-year, at +38%, and session days per player growing 24%. April 2024 saw an acceleration of its year-on-year session days growth vs. Q4.

The introduction of the marketplace beta generated a positive reaction from the community and bodes well for the future of the game thanks to the potential of much stronger network effects. Additionally, the phenomenal reception of the Six Invitational that broke all previous viewership records, a record battle pass conversion and multiple gameplay and player safety improvements contributed to the games’ stellar performance this year.

Another key pillar of our back-catalog, the Assassin’s Creed franchise continued to outperform in Q4, with engagement benefiting from the recent Assassin’s Creed^® Mirage launch and the inclusion of Assassin’s Creed^® Valhalla in the Game Pass, seeing overall franchise quarterly active users grow double-digit year-on-year. The brand grew net bookings by more than 30% over the year.

The Assassin’s Creed and Rainbow Six franchises each benefited from solid fan bases of above 30 million unique active players over the year, highlighting the reach of Ubisoft’s core franchises.

New Releases

This year delivered a sustained cadence of quality releases, designed to be long-term sellers. Q4 notably saw the release of Skull and Bones^™. The game displayed strong engagement, achieving the second-best daily playtime for a Ubisoft game, with an average of 4 hours in the first weeks following launch. Solid D-28 retention is driven by its end-game that launched with Season 1. We target to further improve this retention and enlarge the player base with the upcoming launch of Season 2, Chorus of Havoc, that will continue to enrich the end-game with the addition of new bosses, world events and ship upgrades. Season 2 will also bring new PvE & Solo game modes. The quarter also saw the release of Prince of Persia^™: The Lost Crown that was unanimously praised by players and critics thanks to its best-in-class level design and the engaging and deep combat gameplay, a compelling illustration of Ubisoft’s capacity to revive iconic brands. This was confirmed with the positively welcomed announcement of The Rogue Prince of Persia^™, a new fast-paced 2D action-platforming roguelite developed by partnering studio Evil Empire, set to release in Early Access on Steam on May 27.

The Crew^® Motorfest continues to outperform The Crew^® 2 on acquisition, activity, monetization and net bookings metrics on a comparable basis since launch thanks to its quality seasonal, monthly and weekly activities. The franchise quadrupled its net bookings year-on-year, leading to record net bookings. For its part, Assassin’s Creed Mirage won the Audience Award at the 2024 Pegasus Ceremony, and players continued to engage in the game that notably saw the addition of the Permadeath mode in February.

B2B

In an industry marked by strong demand for high-quality content, the uniqueness and attractiveness of Ubisoft’s portfolio of wholly owned IPs was once again highlighted this year by its capacity to sign B2B partnerships that are incremental to the lifetime value of its back-catalog titles while providing quality content and increased activity for its partners. The year was also marked by B2B partnerships on streaming, including licensing the Activision Blizzard streaming rights on a non-exclusive basis.

Cost reduction plan on track, more focused and selective investments

As part of Ubisoft’s efforts to streamline its operations and adapt to evolving market trends, there have been further reorganizations within the Global Publishing teams, both at the APAC region, that is now organized into three engagement hubs, and at the central level. Additionally, in line with the increased selectivity of its investments, Ubisoft has decided to stop development on The Division^® Heartland and has redeployed resources to bigger opportunities such as XDefiant and Rainbow Six.

Thanks to the continued tight control on recruitments, organizational simplification as well as targeted restructurings, the total number of employees stood at 19,011 at the end of March 2024. This represents a decrease of more than 1,700 over 18 months, while retention has continued to improve over the period.

The cost reduction plan is well on track, with the FY 2023-24 fixed cost base[3] standing at around €1.6 billion. This represents a year-on-year reduction of around €150 million, including a favorable foreign exchange impact.

FY25 Game Pipeline Highlights

The FY25 line-up includes, on the premium side, Assassin’s Creed Shadows and Star Wars Outlaws, two of the industry’s most anticipated games for the year, and on the free-to-play side, Rainbow Six Mobile, The Division Resurgence and XDefiant.

Star Wars Outlaws recently had its comeback with a story trailer, generating excitement and anticipation for its upcoming release on August 30. Developed by Massive, the first-ever open world Star Wars game will invite players to live out a scoundrel fantasy as Kay Vess, and her loyal companion Nix. They’ll navigate the underworld including formidable crime syndicates to pull off one of the greatest heists the galaxy has ever seen, exploring both iconic and new distinct locations.

Assassin’s Creed Shadows, the next flagship title in the franchise and the future of the open world RPG in Assassin’s Creed will be revealed today through the Official Cinematic World Premiere Trailer. Developed by Ubisoft Quebec the studio behind Assassin’s Creed Odyssey, the game will let players embark on a journey through feudal Japan.

XDefiant, a PC and console free-to-play GaaS-native game, will launch its preseason on May 21. Developed by Ubisoft San Francisco, the fast-paced 6v6 first-person shooter arena experience will leverage factions from different Ubisoft worlds, enabling players to enjoy varied playstyles. The game will start with 14 maps, 5 game modes, 5 playable factions and will be enhanced by regular new content updates every quarterly season.

Key organizational changes in the management team to efficiently drive Ubisoft’s growth

Cécile Russeil, former Chief Legal Officer, has been appointed to the position of Executive Vice President in charge of Communications, Corporate Affairs, Diversity, Inclusion, and Accessibility, Human Resources, and Legal. Her deep understanding of Ubisoft’s organization and the video game industry will drive greater agility, consistency, and influence across Ubisoft’s global operations.

SVP Marie-Sophie de Waubert and SVP Martin Schelling have also been appointed Chief Studios and Portfolio Officer, and Chief Production Officer, respectively. They will pursue the efforts initiated 2 years ago to further strengthening shared standards and methodologies as well as best practices and KPIs in the overall game design and production capabilities.

These evolutions will ensure greater efficiency and predictability, through a streamlined and more efficient production strategy and organizational model.

Cécile Russeil, Marie-Sophie de Waubert and Martin Schelling are all members of Ubisoft’s Executive Committee.

[1] Experiences designed to plunge players at the heart of an adventure through an immersive world and captivating lore.

[2] Experiences designed to captivate players over the long-term through engaging and rewarding gameplay, social interactions and frequent content updates.

[3] Includes P&L structure costs + fixed portion of COGS (customer service and supply chain) + cash R&D (excluding performance-based royalties) and excludes all profitability bonuses