Strike, stock market crash, canceled games… Ubisoft in turmoil

From the memory of a trade unionist, this is the “first” strike of such magnitude in the history of Ubisoft. Timon /

A “call to strike” from all French entities of Ubisoft to denounce the managerial practices of management

Unprecedented strike call by all of its staff in France, stock market crash, canceled games… The French video game giant Ubisoft has been experiencing a multiple crisis since the announcement in mid-January of the lowering of its financial forecasts for the 2022-2023 financial year. The union of video game workers (STJV) and Solidaires Informatique launched a “call for a strike” by all French entities of Ubisoft on Friday afternoon to denounce the managerial practices of management.

In the memory of a trade unionist, it is the “first” strike of such magnitude in the history of Ubisoft, since the creation in 1986 of the publisher at the origin of the series “Assassin’s Creed”, underlines with AFP Marc Rutschlé, union section representative at Solidaires Informatique. From a union source, “at least 100 people” went on strike on the Ubisoft Paris Studio site, in Montreuil (Seine-Saint-Denis), while a rally was also planned in front of the Montpellier studio. “For us, it is a success. The message is clear for the management”, emphasizes Marc Rutschlé. Contacted by AFP, management declined to comment.

This protest movement is quite rare in the video game industry, recently marked by the five-week strike by publisher Activision Blizzard at the end of 2021, which resulted last May in the creation of the first union within the company. American. What set fire to the powder at Ubisoft? An internal email sent by CEO Yves Guillemot, referring to “structural adjustments” to come as Ubisoft has committed to the markets to achieve 200 million euros in savings over two years.

“For us, that means redundancy plans. And when we talk about saving money, that means firing people and not increasing the salaries of those who stay. Knowing that we are being pressured by saying: “it’s up to you to do better”, criticizes the representative of Solidaires Informatique. In their press release calling for a strike, the unions demand in particular “the opening of wage negotiations”.

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The strategy “does not convince”

Financially, the French publisher has also fallen heavily on the stock market since the announcement in mid-January of the lowering of its financial forecasts for the entire 2022-2023 financial year, in a context of “deteriorating macroeconomic conditions”. Ubisoft has revised its revenue growth target for 2022-2023 downwards, with sales reduced “by more than 10%” compared to the previous year, despite having initially communicated a growth target “greater than 10%”.

As a result, its stock price returned to its lowest levels of 2015-2016. It ended Friday at 19.16 euros, up +1.75%. “We are disoriented by the extent of the difficulties encountered by Ubisoft”, reacted in a note Emmanuel Matot, financial analyst at Oddo BHF. “Ubisoft does not convince”, explains to AFP Charles-Louis Planade, analyst at Midcap Partners. “There is a clear distrust at the management level, given the many warnings on the results but also by the + deal + made by the Guillemot family with Tencent”. The founders of the French video game champion – the Guillemot family – sealed an alliance with the Chinese giant Tencent in early September to secure their hold on Ubisoft, in a video game market in full consolidation.

Another element against it: the umpteenth postponement of the game “Skull and Bones”, initially scheduled for November 2022, while Ubisoft also indicated that it had stopped the development of three “unannounced” projects, in addition to the four stops already announced in July 2022. “This is not a unique case in the sector, in particular because of the Covid, but we have the impression that at Ubisoft, it is much more marked than at other publishers”, underlines Charles-Louis again Planade. “Afterwards, we must not forget that the memory of the market is short. If the group releases an extraordinary year next year or the year after, everyone will have forgotten,” he adds.

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