A few weeks ago, French publisher Ubisoft revised its full-year targets downwards, reflecting weakness in the casual market (the Nintendo DS in particular hurt Ubisoft) as well as delays to Splinter Cell Conviction and R.U.S.E. Today, in line with the revised expectations, Ubisoft reported third-quarter sales of 495 million euros ($679 million), down 2.7%, and sales for the nine-month period ended December 31 were down 22.5% to 661 million euros.
As was discussed recently, Ubisoft is now looking to focus more on its core properties. "Ubisoft continues to refocus its high-end games strategy by concentrating on more regular releases for its major franchises," the company said. "These refocusing measures also comprise a reduction in new creations investments, which will enable Ubisoft to rebalance its existing resources on a constant headcount basis. This strategy will provide heightened visibility and profitability with a lower level of risk, thereby accelerating the generation of cash flow."
That doesn't mean that Ubisoft is giving up on the casual market, however. In fact, the publisher said "there is still a large potential to tap" the casual segment, and Ubisoft plans to do that with new games for the Wii, "by capitalizing on successful titles such as Just Dance," as well as "numerous projects" for the upcoming launches of Microsoft's Natal and Sony's motion controller. The publisher expects to have more projects for Facebook to leverage the social gaming boom too. Support for Nintendo DS, however, "has been significantly reduced, resulting in a sharp decrease in external investments."
For the current fiscal year ending in March, Ubisoft is forecasting sales of around 860 million euros and an operating loss of around 50 million euros. The publisher expects to bounce back in fiscal 2010-2011 with a "return to profitable growth and positive cash-flow." This assumes a more stable market overall, a "product mix in favor of franchises for Xbox 360 and PS3," and the launch of "at least 7 franchise titles" (Tom Clancy’s Splinter Cell Conviction, Driver, Prince of Persia The Forgotten Sands, Assassin’s Creed, Tom Clancy’s Ghost Recon and Raving Rabbids). Ubisoft is also planning for "at least 2 new brands" (R.U.S.E has already been announced) and "at least 5 online games" (Imagine, Trackmania 2 and Might & Magic Heroes Kingdoms have already been announced).
