Ubisoft Announces Game Cancellations and Organizational Overhaul

Ubisoft is in deep water. Given the challenges from the current state of the market and its financial difficulties, the game publisher is set to refocus its portfolio and content pipeline. In an announcement by the company on January 21, Ubisoft confirmed that it will discontinue six games that are no longer a priority, including Prince of Persia: The Sands of Time remake, four announced titles, and one mobile game. Moreover, it will also delay the release of seven games, including an announced game title that was planned for FY26, which will come in FY27.

The announcement immediately sent Ubisoft’s share price down by almost 30% on the Paris stock exchange. Over the past several years, the company has already closed the Halifax mobile studio and the Stockholm studio, with restructuring happening also at three other locations: Abu Dhabi, RedLynx (Helsinki, Finland), and Massive (Malmö, Sweden). Ubisoft has also already eliminated around 3,000 positions.

According to the release, Ubisoft is set to achieve its cost reduction program of €100 million by March 2026, one year ahead of target. The new goal will be to further reduce its fixed cost by an additional €200 million in the next two years, to a total of €500 million since FY22-23. In terms of revenues, the company is now forecasting €1.5 billion euros with an operating loss (EBIT) of around 1 billion euros. The number is mainly reflected by the 650 million euros one-off depreciation caused by game cancellations and delays. Free cash flow is projected to be between negative of €400 to €500 million, with net debt of 150-250 million euros by the end of the financial year.

With this decision, Ubisoft is redesigning itself to try to achieve sustainable growth. Aside from a revised three-year roadmap, the company will introduce a new operating model and a gamer-centric organization this April to improve efficiency and enable faster, decentralized decision-making.

The new model will be centered around the five Creative Houses, each focusing on a clear genre and brand focus, with full ownership of the games and led by dedicated leadership teams.

Most importantly, each creative house has to be financially accountable for both profit-and-loss (P&L) and cash generation. To support all Creative Houses, Ubisoft will also introduce the Creative Network, designed to provide production capacity and that will work on a project-by-project framework, as well as the Core Services, which will be responsible for business operations, technology and infrastructure, and production services such as localization and QA/QC.

Additionally, the company is set to implement a return-to-office policy for five days per week for all teams, with an allowance of working-from-home days. In a Radio France interview, Vincent Cambedouzou, a union representative for the Video Game Workers’ Union at Ubisoft Paris, denounced, “We already faced a lot of controversy with our employer when they wanted employees to return three days a week. Many people found themselves in particularly difficult situations.”

He emphasized that the widespread adoption of remote work has profoundly changed the lives of many employees. “After remote work was implemented, people moved and no longer live in the region where they are expected to work. Of course, in that respect, it’s terrifying for a lot of people.” In response to widespread unrest, a strike was called starting January 22

While the financial numbers look dire, Ubisoft's decision to put its flagship esports title, Rainbow Six Siege, in the Creative House with other established franchises like Assassin's Creed means that the company is making the game a clear priority to drive value.

On the other hand, however, esports is known for struggling to drive high revenues, meaning that the competitive scene will face more scrutiny in the upcoming years. Last year, the company introduced a revamped R6 Share Partner Program, giving bundle releases to teams every year to increase revenues for participating teams through digital items sales. If the revised model were to underperform, Ubisoft might pivot once again to concentrate spending where it converts.