Ubisoft Reports Mixed FY2024-25 Earnings Despite 20% Revenue Decline

Ubisoft reported mixed financial results for the fiscal year 2024-25, with net bookings declining nearly 21% to €1.85 billion, slightly below targets due to partnership timing issues. Despite this, the company maintained a solid balance sheet with a cash position around €1 billion and improved net debt of €885 million, supported by positive free cash flow of €128 million driven by strong operating cash flow. The launch of Assassin's Creed Shadows was notably successful, achieving the second-highest Day One sales in the franchise's history, alongside stable performance from other key franchises like Rainbow Six Siege and Far Cry. Ubisoft is undergoing a strategic transformation, including creating a new subsidiary backed by Tencent to accelerate growth of its three iconic IPs and aiming to maintain net debt near zero after the Tencent transaction closes by the end of 2025. The company plans flat net bookings for fiscal 2025-26 with an expected operating break-even and negative free cash flow reflecting ongoing transformation efforts, but anticipates returning to positive operating income and free cash flow in fiscal 2026-27. Ubisoft is also reshaping its operating model to better meet player needs and improve game quality, with additional cost reductions planned and a new group organization to be announced by year-end.