Ubisoft reports full-year 2022-23 earnings figures

▪ Assassin’s Creed®: Record active users for the franchise in a year. Assassin’s Creed® Valhalla now has 44% more players life-to-date than Assassin’s Creed® Origins and 19% more than Assassin’s Creed® Odyssey on a comparable basis, with materially higher revenue per player, leading to life-to-date net bookings up respectively +82% and +61%.
▪ Tom Clancy’s Rainbow Six® Siege: Confirmation of the strong engagement turnaround, with playtime in Q4 strongly up +30% vs. last year. Full year PRI up 13%.
▪ Tom Clancy’s The Division® 2: Session days up 28% YoY in Q4 leading to 36% net bookings growth over 12 months.
▪ Free-to-play initiatives:
– XDefiant: Closed beta reached over 1 million players with strong viewership and positive community feedback
– Upcoming test phases for Rainbow Six® Mobile, The Division® Resurgence and The Division® Heartland

2023-24 line-up to reflect key strategic pillars: New releases across big brands and long-lasting Live games with Assassin’s Creed® Mirage, Avatar: Frontiers of Pandora™, Tom Clancy’s Rainbow Six Mobile, Tom Clancy’s The Division Resurgence, another large game as well as Skull and Bones™, The Crew® Motorfest and XDefiant. Ubisoft Forward will take place on June 12th.

2023-24 TARGETS CONFIRMED

Today, Ubisoft released its earnings figures for FY2022-23.
Yves Guillemot, Co-Founder and Chief Executive Officer, said “FY2022-23 was in line with our revised financial targets. While this past year was challenging for the industry and for Ubisoft, it was pivotal for the Company as we reinforced our strategic focus on our biggest opportunities, initiated a meaningful cost reduction plan and provided additional development time for our strong pipeline of content. As part of our progressive reallocation of resources, we notably plan to increase the number of talents working on the Assassin’s Creed brand by 40% over the coming years. Our teams are making headway across the board as we look to bring exciting gaming experiences, both premium and free-to-play, to players on all platforms in FY2023-24 and beyond. Development of this year’s line-up is progressing well with big brands like Assassin’s Creed, Avatar, Rainbow Six and The Division, as well as on long lasting Live Service titles like Skull and Bones, The Crew Motorfest and XDefiant. More information will be shared at our upcoming Forward event.
Ubisoft’s unique development model relies on a robust iterative design process which proved successful to enter the Open World and Live Services markets, and that we have been applying to free-to-play. While mastering free-to-play is hard, and it is very important to remain prudent, recent developments are encouraging. This indicates that we are on the right path to bring our brands to significantly larger audiences. The XDefiant closed beta reached over 1 million players with strong viewership, community feedback and retention. Similarly, we expect Rainbow Six Mobile and The Division Resurgence to illustrate our progress and we are happy to see that the gameplay reveal of The Division Heartland has received positive community reception. In line with our commitment, we are making visible iterative progress on which we can build the next steps toward ultimately delivering a breakthrough in this major market.”
Frédérick Duguet, Chief Financial Officer, commented “Our iterative, talent-intensive, organic-driven approach is a multi-year endeavor. We are now entering a new phase of our development, starting in 2023-24 with a significant line-up of big brands and long-lasting Live services. We continue to work on our cost reduction plan of at least 200 million euros over the next 2 years. With tight control on recruitments as well as initial targeted restructurings, our total number of employees worldwide dropped below 20,000.”
Yves Guillemot concluded: “The industry’s prospects are promising, and Ubisoft has a great opportunity to transform its brands into truly global phenomena and build an increasingly recurring business. We have implemented meaningful evolutions throughout our organization over the past 3 years and will continue to adapt to the fast-moving environment. Ubisoft’s future will be built with the help of its talented teams, its beloved IPs and dependable technologies as well as a strong balance sheet.”

Game Highlights
The Assassin’s Creed franchise reached a record level of active users for a given fiscal year. In terms of acquisition, Assassin’s Creed Valhalla now has 44% more players than Assassin’s Creed Origins and 19% more than Assassin’s Creed Odyssey life-to-date on a comparable timeframe, with materially higher revenue per player leading to life-to-date net bookings up respectively +82% vs. and +61%. In September, we presented a powerful roadmap for the brand, including the upcoming Assassin’s Creed Mirage, Assassin’s Creed codename Red, Assassin’s Creed codename Hexe, Assassin’s Creed codename Jade and Assassin’s Creed codename Invictus as well as the Infinity platform.
Rainbow Six Siege benefited from positive momentum this year in a highly competitive landscape, reflecting the team’s remarkable work to deliver cross-platform, quality content, onboarding features and anti-toxicity measures. We saw a confirmation of the strong engagement turnaround, with Q4 playtime strongly up +30% vs. last year. March, along with the release of the Year 8 battle pass, equaled a record month in terms of DARPU. As a consequence, full-year PRI is up 13% year-on-year. As we look to bring the franchise to a much larger audience, Rainbow Six Mobile will start its 6-week closed beta on June 6th.
The Division 2 saw strong engagement in Q4, with session days up 28%, leading to full-year net bookings growth of 36% year-on-year. In April, our teams showcased the future of the franchise during the Division Day. The Division 2 team announced their Year 5 roadmap with the first season to launch in early June, which will notably include a new game mode, Descent. The Division Heartland team showcased the first gameplay footage, receiving a positive community reception, and announced that there would be a closed beta later this year. Finally, The Division Resurgence, the upcoming mobile game, announced a new testing phase for this summer.Update on capital allocation and the cost-cutting program

As part of our increased strategic focus on our biggest growth opportunities and progressive reallocation of resources, Ubisoft will notably increase the number of talents working on the Assassin’s Creed franchise by 40% over the coming years to fuel its ambitious expansion.
As announced in January, Ubisoft is also adapting its organization with an expected net reduction of its non-variable cost base by at least €200m over the next 2 years. This will be achieved through targeted restructurings, tight control of recruitments and divesting some non-core assets. Ubisoft will continue to look at hiring highly talented people for its biggest brands and live services.
Following tight control on recruitments as well as initial targeted restructurings, including the closure of 5 European business offices, the total number of employees worldwide dropped below 20,0001 versus more than 20,700 at end of September 2022. Structure costs have started to decrease, with H2 2022-23 down 2% year-on-year versus an increase of 18% in H1 2022-23. R&D investment growth was limited to 5% in H2 2022-23 versus H1 growth of +17%.

Additionally, Ubisoft’s Customer Relation Center team is evolving its organization, impacting offices in Cary, North Carolina in the US and Newcastle in the UK.

Reinforcing the Global Creative Office
The Group appointed Katie Scott as Vice President of Editorial within the Global Creative Office. Katie brings more than a decade of experience in video game production, having contributed to more than a dozen titles, including Gears 5 and FIFA games. As per the Company’s commitment, the past three years have been marked by the external appointment of three high-profile talents as VP of Editorial, bringing additional experience and diversity to the Editorial team.

Generative AI
As the world adopts Generative AI at a record pace, GDC 2023 demonstrated its immense potential to profoundly transform creative industries. Ubisoft is uniquely positioned to lead this transformation, with a strong game technology expertise, over 20 years of proprietary data and assets, and a rich portfolio. Internally, early adoption is fast, with creators and developers of all levels experimenting with the technology and taking advantage of the booming Generative AI landscape. With them, Ubisoft is shaping a responsible framework with talent management and fair use at heart. In parallel, teams are leveraging years-long R&D efforts in AI and Machine Learning applications, especially through La Forge, to identify the best use cases and harness the power of this technology to have a positive impact on creativity, workflows, and players’ experience.

¹ As of May 16th, 2023

Disclaimer
This press release may contain estimated financial data, information on future projects and transactions and future financial results/performance. Such forward-looking data are provided for information purposes only. They are subject to market risks and uncertainties and may vary significantly compared with the actual results that will be published. The estimated financial data have been approved by the Board of Directors, and have not been audited by the Statutory Auditors. (Additional information is provided in the most recent Ubisoft Registration Document filed on June 14, 2022 with the French Financial Markets Authority (l’Autorité des Marchés Financiers)).