PARIS Ubisoft is increasing its writedown estimate to 500 million euros $538 million and reducing its full-year revenue target after ending 2022 with weaker than expected sales, the French video game maker said on Wednesday.
Ubisoft cited the deteriorating economy, which was marked by lower spending on non-essential goods, as the reason behind the acceleration of the depreciation, previously targeted at 400 million euros.
The group is planning to reduce staffing by 200 million euros over two years, including staff reduction, Chief Financial Officer Frederick Duguet said in a call with reporters that it was postponing the release of its game Skull and Bones.
Duguet didn't elaborate on the size of the staff reduction, which will be made through attrition, the company said. It expects full-year net bookings to be down by more than 10 per cent, compared with a previous target of 10 per cent, it added.
Net bookings for the third quarter are expected to be 725 million euros, down from a previous estimate of 830 million euros. Duguet said that there was significantly less spending around the critical sales period.
The biggest brands took a larger than expected market share, which resulted in less spending on other games, Duguet said.
The Chief Executive Officer Yves Guillemot said in a statement that the company was surprised by the weak performance of its Mario Rabbids: Sparks of Hope game at the end of last year, a crucial period for the sales of video games.
Ubisoft said it was targeting operating income of around 400 million euros for fiscal 2023 -- 2024, after taking into account the less favorable economic environment.