Ubisoft sells more, makes less

GRAW publisher takes home almost $15 million, down more than 50 percent from previous year; sales up 3 percent as R&D soak up profits.

French game publisher Ubisoft today announced its financial results for its fiscal year ended March 31, 2006. Despite a slight jump in sales, the company's profits were actually down more than half.

Ubisoft took in 11.9 million euros (almost $15 million) last year, compared to 24.7 million euros (just over $31 million) the previous year. Overall sales were up to 547.1 million euros (just under $687 million) from 532.5 million euros (almost $670 million), a jump of 3 percent.

A company statement stressed increased expenses on next-gen research and development as well as current-gen advertising as the reason for lower profits, but CEO Yves Guillemot sees the numbers as positive for the company.

"During this period of high investment, Ubisoft has continued to improve its financial position and can therefore accelerate its growth and pursue its development," said Guillemot.

According to Guillemot, Ubisoft earned almost 30 percent of its sales from its next-generation games, which includes Peter Jackson's King Kong: The Official Game of the Movie and Tom Clancy's Ghost Recon Advanced Warfighter. Ubisoft also claims to have taken in 20 percent of the market share for the Xbox 360.

For the upcoming years, Guillemot expects positive numbers due to Ubi's contribution to next-gen systems. "We forecast a sales growth of between five percent and 10 percent [for 2006-2007], despite a global market which should decrease by seven percent, thanks to the launch of five new high-potential brands... 2007-2008 will be a year of strong recovery for the sector and we should once again outperform the market, whose growth is expected to approach 17 percent for the year."

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Discussion

80 comments
twtech
twtech

Actually it makes a lot of sense. They sold more games, which means they took more money in. But because of the transition to next generation consoles, they spent significantly more on research and development last year than in previous years. Once those additional costs were taken into account, they made less profit last year than the previous year.

Teivan
Teivan

[This message was deleted at the request of the original poster]

xbox_1
xbox_1

The build of Red Steel that was shown at E3 '06 certainly didn't look "adult" as some people are putting it. Assassin's creed does, and it will certainly be a hit. I hope it comes to the X360 though, because I can't afford a PS3 at this time.

jemini12
jemini12

They should think about making sport games, because clearly Ubisoft has been the best 3rd party company last year and this year. Just about every game they put out was a hit.

PiPbOY0
PiPbOY0

Ubisoft needs alot more respect than they get. I hope red steel changes ppls ideas about ninty being kiddie.

ragin_massaih
ragin_massaih

Red Steel is guna be rude, hope they can afford to finish it off nicely!

Myugenjin
Myugenjin

I don't believe devs become profitable unilt at least a console's 2nd year and seing this as next gen that won't be until march of 2008!

Kwiksilva
Kwiksilva

Yea theres gunna be some good 1s cumin out for the next gen like Red Steel and Assain's Creed.

diesil
diesil

ubisoft will eventually sell more than ea i dont know if anyone noticed but doesnt it seem like all of ea's games look exactly the same time im not sayin all of them but most of them are

lardmister
lardmister

Ubisoft actually care about delivering good quality games to their customers, whereas EA just bring out sequel after sequel, with hardly any time in between them and minimal improvement just to make as much money possible out of you. Thats why i hate them. OH YEH!! They also ruined the james bond license, bringing out terrible games every time. They should take a leaf out of ubisofts book and take more time and consideration about the games they are bringing out!!!!!

ashuncc2
ashuncc2

Hopefully, as the learning curve for next gen consoles levels, profits will improve for game developers. Providing us, the end consumer with great games!

nomadbob5
nomadbob5

just because they are down when they are basically only selling 360 games doesn't mean that when the ps3 or the wii they will fail at life. no, when all the next-gen consoles come out they will do fine (maybe not so much on the ps *coughgaycough*)

miiiguel
miiiguel

PiNoYPrOjEcT: Burnout Revenge 360 is a very good game. Who cares if it has only so much tracks, if it's darn FUN!!!!

miiiguel
miiiguel

PS3 is gonna "kill" some SW developing companies.

mgall80
mgall80

Once they get more next gen titles under their belt and the less expensive (to make) Wii games roll out, I think Ubi will see a big jump in numbers for March 31 2007.

agent15
agent15

Ubisoft have been fine on consoles but their PC games always have poor online connectivity for some reason.

rootATdarkstar
rootATdarkstar

Hopefully sales facts like this doesn't send new games into the $70 a piece price range.

ElementalFire
ElementalFire

FIVE new high-profile brands?!? Sweet Jesus, Fisher!

watercandle
watercandle

Starting from SC:DA on September, Rainbow Six Vegas, Assassin's Creed, BIA Hell's Highway, Haze, Red Steel, etc... OMG This is freakin' amazing...

usaokay
usaokay

Ubi = Less bugs :D EA = More patches, more bugs D:

doom27nyc
doom27nyc

M$ must buy UBISOFT they r the top DEV rt now

jag215
jag215

I love ubisoft but just because you like them doesn't mean you have to hate EA

Fallout_red
Fallout_red

Just wait for Assassins Creed and Haze!

rynmls
rynmls

well deserved income...

Optimusv2
Optimusv2

Xbox360 games not helping ubisoft??? Ghost Recon for the 360 was the BIGGEST sales debut a title has ever had in Ubisoft's history... please know what you are talking about.

tr00pa_26
tr00pa_26

stop piracy dudes i mean ubisoft makes great games the deserves the right money

slickr
slickr

Blizzard owns all... "Decede" old warcraft 3 sells more than ubisoft's GRAW!

XtremePhsyco
XtremePhsyco

ubisoft is a good company i hope they improve and keep producing good games

daqua_99
daqua_99

Ubisoft is an inspiration to any developer which is outside America and Japan ... good on ya you French guys!

snyper16
snyper16

UBISOFT WILL DO EVEN BETTER WHEN THE EXPANSION TO G.R.A.W. COMES OUT, SPLINTER CELL: DOUBLE AGENT IS RELEASED, ANOTHER RAINBOW SIX 3, AND A FOURTH FAR CRY FOR THE XBXO 360(LATER).

samekila
samekila

im glad Assassins Creed is coming to 360 that was why I wonted a p3 that game looks awsome and GRAW is very good I like FARCRY to but GRAW is alot more fun to me I hope Ubisoft uses map creaters more like they did with FARCRY

mike_mgoblue
mike_mgoblue

Xbox 360 sales helped Ubisoft a lot!!! The main thing that hurt Ubisoft is obvously the VERY EXPENSIVE PS3 development kits that require a LOT of research and development in order to operate properly, because they are so difficult to develop for. This is the main reason why Assassins Creed has now been announced for the Xbox 360. There is no way that Ubisoft could afford to release the game for just the PS3...especially when you consider that it was already developed for the Xbox 360 under the name Project Assassins. I think Ubisoft is doing a great job, but they need to forget about spending money on Playstation 3 development kits, and they need to forget about spending their own money on research and development costs associated with the difficult to develop for PS3. I think Ubisoft should stick with supporting Microsoft.

SirAndyII
SirAndyII

Once you go GRAW, you don't go back.

runstalker
runstalker

They've given us some pretty f-ing good games over the last 3-4 years, and a sizeable chunk of them were internally developed. I admire that. Ubi Montreal is right up there with the elite developers of the world.

Kenzo287
Kenzo287

"smiley17O" "ea is plublishing crysis not ubisoft. red steel is one of the most disapointing looking things for the wii" First off Red Steel looks awesome. Second it is goin to be the greatest FPS since TimeSplitters (i.m.o. the best fps money can buy)

Kayrod29
Kayrod29

I wil always buy Splinter Cell, that game is way too good.

smiley17O
smiley17O

"Tybolt" "They got Asassins on the way, A new Splinter cell game. The Wii swordfighting game (Red steel i think) And early next year they will publish Crysis, The sales will go up, I promise because all real gamers know that Ubi is better then EA" ea is plublishing crysis not ubisoft. red steel is one of the most disapointing looking things for the wii

Voltaris
Voltaris

Well, don't forget that Ubisoft also reduced their debt of 9 millions.

Brotherbraak
Brotherbraak

Ubisoft is only better than EA because Far Cry, G.R.A.W., and Splinter Cell but EA challenged them with BF 2

thekey
thekey

Still much better then EA!!!

Vulpis
Vulpis

Oh, and as a friend reminds me, a question for the Ubisoft PC-game fans...Enjoying your Starforce copy-protection infestation? ;-) Granted, they've kicked those schmucks to the curb *now*, but lots of the software is still out there--such as Syberia II, which I've seen on budget racks just about *everywhere* (and was thinking about getting as its the sort of game I like, until I heard about the Starforce crap).

Tybolt
Tybolt

They got Asassins on the way, A new Splinter cell game. The Wii swordfighting game (Red steel i think) And early next year they will publish Crysis, The sales will go up, I promise because all real gamers know that Ubi is better then EA

assasin1080
assasin1080

All the more reason for Assasin creed comming to xbox360!!...not in ubisoft blood to be exclusive!!!! to Sony

Vulpis
Vulpis

As a player of Uru: Ages Beyond Myst (and its current incarnation Until Uru), awaiting its long-delayed proper online release as 'Uru Live' on GameTap after Ubisoft utterly botched (Gee, enough new players arriving that your server lags enough that the players of the *other* online game hosted on it are complaining, and you rate that as a 'failure'? Way to go, geniuses...), all I can say here is, in as accurate a rendition of Nelson from the Simpsons as possible..."Ha-ha!" Meanwhile, 'minime78326'--what probably happened is that the two sets of numbers were figured at very different euro-to-USD exchange rates.

Maui00
Maui00

dreamcast2121: said: "looks like x-box 360 games are not helping the company" sure they are. the current generation of GRAW and Kingk Kong didn't help too much

Poltergeist13
Poltergeist13

I sure is glad Assassin's Creed is coming to X360.

K1LLSWITCH
K1LLSWITCH

[This message was deleted at the request of the original poster]