Shares of France-based Ubisoft Entertainment SA (FR:UBI) crashed by nearly 20% as of writing after the company cut down its guidance for FY25. The company now expects net bookings of approximately €1.95 billion for Fiscal 2025, down from the €2.32 billion recorded in the previous year. Ubisoft will announce its first-half results for FY25 on October 30.
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Ubisoft is a video game publisher, famous for its hit franchises like Assassin’s Creed, Far Cry, and Rainbow Six.
Ubisoft Struggles with Assassin’s Creed and Star War
According to Ubisoft’s update, the reduced targets primarily stem from the struggles related to Assassin’s Creed Shadows and the weaker-than-expected launch of Star Wars Outlaws. The company stated that Assassin’s Creed Shadows will be released around mid-February 2025, to allow developers more time to refine the game. The launch was originally set for mid-November.
This delay follows disappointing sales of Star Wars Outlaws, prompting the company to redirect resources to enhance the title for a broader audience during the holiday season.
Furthermore, Ubisoft CEO Yves Guillemot expressed disappointment with the second-quarter performance, which fell short of expectations. Net bookings for the second quarter of FY24 are projected to range from €350 million to €370 million, below the previous guidance of around €500 million.
The company now expects around break-even non-IFRS operating profit and free cash flow for the fiscal year, down from the previous guidance of a slight increase in operating profit and positive free cash flow.
Is Ubisoft a Good Stock?
Year-to-date, Ubisoft stock has fallen 60%. Shares hit a seven-year low in January 2023 after the company lowered its revenue forecast and cancelled several games.
According to the TipRanks consensus, UBI stock has received a Moderate Buy rating backed by seven Holds, five Buys, and one Sell recommendation. The Ubisoft share price target is €22.55, which represents 148% upside potential from the current level.
