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Ubisoft cuts full-year earnings forecast

Publisher shaves 12-month revenue to $1.25 billion; casual weakness leads to "refocus" on 360, PS3 development; new Driver, Raving Rabbids due by March 2011.

Splinter Cell: Conviction has been a long time coming from Ubisoft, and the French publisher confirmed today that, despite announcements to the contrary, gamers have still more waiting to do. Once scheduled for February 23, Splinter Cell: Conviction is now on track for an April release, with WWII strategy title R.U.S.E. also bumped out of its current fiscal year ending March 31, 2010.

Avatar sales came in below expectations, as well.

Avatar sales came in below expectations, as well.

With the two high-profile games bumped from its current fiscal year, Ubisoft also took the step of lowering its third-quarter and full-year revenue forecast. The publisher now expects €495 million ($718 million) during the October-December quarter and €860 million ($1.25 billion) for the year, down from previous projections of €540 million ($783 million) and €1.04 billion ($1.51 billion), respectively.

Ubisoft also expects to post a €50 million ($72.5 million) loss for the fiscal year, a revision from its previous forecast of at least a €70 million ($102 million) operating income. The revision was due to a number of factors, including poor sales, underperforming catalog titles, and abandoned projects.

The two game delays aren't the only factors weighing on Ubisoft's financial performance. According to Ubisoft, its casual-games segment on the DS severely contracted in 2009, with revenues expected to fall €160 million ($232 million)--a 50 percent decline. The publisher did note that it has still seen success with its casual line on the Wii, particularly with its rhythm game Just Dance, released in November 2009.

Despite Assassin's Creed II's impressive 6-million-unit milestone, Ubisoft also saw weakness in its core game market. Namely, the publisher said that its heavily hyped game adaptation of James Cameron's Avatar, as well as unspecified non-casual Wii titles, turned in "lower than expected" performances. Exact figures for Avatar, the film inspiration for which has grossed over $1 billion worldwide, were not provided.

Given its weakness in the casual market in 2009, Ubisoft said that it plans to more heavily emphasize development for the Xbox 360 and PlayStation 3 during its coming fiscal year.

"With a view to further reducing our exposure to the DS, we intend to continue to refocus our development resources on our major franchises and on the Xbox 360 and PS3, the two consoles which are expected to see sales growth in games for gamers in 2010," CEO Yves Guillemot said in a statement. "The 2010-11 lineup--which is stronger in franchises for Xbox 360 and PS3--reflects our refocusing efforts and should enable us to both win market share and enhance our profitability."

Ubisoft also offered a cursory look at said 2010-11 lineup, one that revealed a few previously unannounced projects. Having stated its weakness in the racing market in November, Ubisoft said that it will at last make use of the Driver license it purchased from Atari in 2006. The publisher also expects to release Raving Rabbids 4, as well as a new Assassin's Creed episode that will introduce online multiplayer to the franchise.

36 Comments

  • GunBladeHero

    Posted Jun 11, 2010 12:16 pm GMT

    Cool! I hope the new Driver will show us new features as well as the return of the replay feature! I loved that feature!

  • Inconnux

    Posted Jan 29, 2010 3:38 pm GMT

    almost every game based off a movie sucks... gamers have figured this out and avoid them like the plague

  • osiris

    Posted Jan 19, 2010 7:48 pm GMT

    That's what happens when you make a half-assed game and hope that since its called "Avatar" like a blockbuster movie, it'll rake in the cash... Hopefully they learn from that and continue to make excellent games like AC. How will that work with MP? Everyone will be blocking and counter-attacking and noone will actually hit anything, heh.

  • fatpumba3

    Posted Jan 15, 2010 5:24 pm GMT

    Why is everyone like "ZOMG THE FREAKIN ECONOMY IS SOOOO BADZ" I bet half the people who say this are just people who got there pay cut by $5 and claim they can't afford games anymore. Stop whining.

  • fishnpeas1

    Posted Jan 15, 2010 5:57 am GMT

    Harerazer Posted Jan 15, 2010 12:09 am GMT The formula was a failure tho from the start since Avatar heavily depends on the 3D aspect and that just couldn't be replicated in the game. ______________________________________________________________

    Wrong chummy, Avatar has stereoscopic 3D built into the PS3 version, it's just no bugger has a TV capable of displaying it correctly. (I found it stupidly annoying that it has a feature that my lowly 46" 1080p tv cannot display)

  • Harerazer

    Posted Jan 14, 2010 4:09 pm GMT

    This has nothing to do with the "casual market" and everything to do with crap games (20+ DS games). They said they turned a profit from Just Dance and sold a ton of AC II's so that covers both markets. But when you license properties (Avatar) you have to pay heavily so your profit is going to be down from the start. The formula was a failure tho from the start since Avatar heavily depends on the 3D aspect and that just couldn't be replicated in the game. Ubisoft turned out a movie game, basic and simple, and expected the name to carry them to riches. Sorry Ubi, doesn't work that way. We don't want games with good taste, we want games that taste good.

  • Ric_SlayeR

    Posted Jan 14, 2010 3:15 pm GMT

    @SLjimbolian

    So true.

  • SLjimbolian

    Posted Jan 14, 2010 12:09 pm GMT

    JACQUES LE BLEU!

  • airshocker

    Posted Jan 14, 2010 12:03 pm GMT

    I'm glad they're focusing more time and effort on their bigger titles and franchises. A foray into the casual-side of gaming with the Wii was a fail from the start.

    They should have known, though, that the Avatar video game wasn't going to do very well. Gamers are very wary with movie adaptations.

  • jericho_s83

    Posted Jan 14, 2010 11:31 am GMT

    the game is still fairly new not everyone can aford to go out and by games right now of course sales droped i havent got a game since last year i cant wait to go get some new ones not to menchain it would have sold better if ya all new how to make proper camara modes and not that glitchie cantsee by a rock crap

  • firehawk998

    Posted Jan 14, 2010 9:09 am GMT

    this time Ubisoft I want a Rayman game where it stars Rayman you know the guy from the original games not the Wabbits or whatever.

  • prioritymail

    Posted Jan 14, 2010 9:02 am GMT

    This is great news for me! I never really like casual games anyways

  • LosDaddie

    Posted Jan 14, 2010 8:41 am GMT

    Ubsoft will be fine. They probably estimated far too many sales for Avatar that never materialized.

  • strayfies

    Posted Jan 14, 2010 8:22 am GMT

    Absolutely agree with DNM1. Ubisoft is capable of some good titles here and there, but they also publish a TON of shovelware, and that they relied on a movie-based game says enough on its own. If nothing else good comes from economic downturn, I hope these companies start condensing their efforts into higher quality products.

  • DNM1

    Posted Jan 14, 2010 8:00 am GMT

    Thank whom ever you pray to. This makes my ears buzz and my mouth sing. Maybe we'll actually start getting quality games with the release of Conviction. I'm glad at least one company has learnt their lesson with the casual flop-market. Fads are fads, real games and real gamers are here to stay, be it one generation or the next. Now lets just hope that the next E3 doesn't focus on casual games only to put the idiotic hype machine into full production.

  • pikaby

    Posted Jan 14, 2010 6:08 am GMT

    Ubisoft, what did you expect? Things like Dogz, Catz, Babyz, My (insert language here) Coach, do not sell well. You made the wrong games and you blame the console. The DS isn't just about casual games.

    The same mistake by a lot of the other publishers who still think they can make a quick buck out of the Wii/DS with shovelware.

  • angelGP32

    Posted Jan 14, 2010 5:34 am GMT

    @BloodMist: the entire Imaginez line is Ubi. And they made a big deal about it last E3, now it seems to be bombing and I for one am glad. Now maybe other companies will see UBI bomb in this market and start releasing quality over quantity.

  • -HCMF-

    Posted Jan 14, 2010 4:44 am GMT

    where are all the tom Clancey games? Didn't they pay a ton o cash for his name? Ghost Recon? Rainbow six?

  • Pete5506

    Posted Jan 14, 2010 1:01 am GMT

    I would love to see another Ghost Recon, maybe a new Rainbow Six

  • red-ray

    Posted Jan 14, 2010 12:24 am GMT

    where the hell is Ghost Recon???

  • Zerosumgame

    Posted Jan 13, 2010 10:14 pm GMT

    One word: GOOD!

  • SDBusDriver1979

    Posted Jan 13, 2010 7:53 pm GMT

    Driver games really went down hill after the first one. Being able to leave your car and hijack another car killed it for me, which turn the game from a skill base of not crashing and making to the point on time to this hybrid gta wannabe before gta3 existed that was awkward and clunky. This is also the same problem that happen in Star Wars Rogue Squadron, they had to fiddle around with something good. Reflection can make some awesome racing mechanics and ideas (bring back Destruction Derby please) but when they go beyond that there is huge problems.

  • Antatious

    Posted Jan 13, 2010 7:04 pm GMT

    Seriously, NoDzombie. I can't stand seeing so many ridiculous EA titles doing the same exact thing.

  • mark_unix

    Posted Jan 13, 2010 6:53 pm GMT

    lol@casual...
    i always said only idiots play casual games, and there are too few idiots to make it a viable market...
    as people stick with 1 game and never buy a new one, there is no casual gaming market (period).

    it's like casual sex, not as good as the real thing...

  • dogpigfish

    Posted Jan 13, 2010 6:52 pm GMT

    Development sure is slowing down for them.

  • fon1988

    Posted Jan 13, 2010 6:01 pm GMT

    Where is Rayman 4? What is taking so long? That's not a casual game and could easily make alot of money of 360 and PS3 since there are barely any platformers on either console.

  • NoDzombie

    Posted Jan 13, 2010 5:52 pm GMT

    finally a company has realised that there is no money to be made in spamming out casual games when the economy is so bad, and has decided to support the real gamers that are still willing to fork out what little money they have for a good game in this terrible economy

  • BloodMist

    Posted Jan 13, 2010 5:42 pm GMT

    Ahh good, glad to see a poorly made movie tie in game not sell well for once.

    BTW i had no idea Ubi published any DS games.Were they just lame casual games? *shrugs*

  • timthegem

    Posted Jan 13, 2010 5:18 pm GMT

    More Myst, I say!

  • KillerWabbit23

    Posted Jan 13, 2010 3:26 pm GMT

    wow.... well, movie games, despite their crappiness, usually sell like hotcakes... So does this mean that the world is catching on to the trend????

  • lamprey263

    Posted Jan 13, 2010 3:07 pm GMT

    Pfft, the Avatar game underpeformed?! Since when did companies have high expectations of movie based games, traditionally known for their failures?

  • K-Grogg

    Posted Jan 13, 2010 2:42 pm GMT

    "Avatar sales came in below expectations, as well." Yeah, that's what happens to you when you create a terrible game that clearly had no passion, care, or quality development put into it! What a waste! Think of all an Avatar game COULD have been! ='(

  • Jak_Napier

    Posted Jan 13, 2010 2:14 pm GMT

    again, more not so great news.

  • Obliterati

    Posted Jan 13, 2010 1:48 pm GMT

    I know times are tough for everyone, but there seems to be a lot of blunders, missed opportunities and bad ideas in the strategic plans of game companies. Console companies too, for that matter.

    I'm surprised more bigwigs aren't losing their jobs over this relentless assault of bad earnings reports.

  • angelGP32

    Posted Jan 13, 2010 1:43 pm GMT

    well how do you expect to sell a lot of software when you release 30 different versions of the same software, eventually people are going to stop buying it. The Imaginez stuff. I for one am glad, screw shovelware and focus on good games for a real system with real gamers.

  • TBoogy

    Posted Jan 13, 2010 1:27 pm GMT

    great news for 360/ps3 owners I guess.

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