Ubisoft Half Year Financial Report: H1 FY23

Key insights

7 takeaways

01
Ubisoft reported a net loss of €190.1 million for H1 FY23, driven by a 2.7% revenue decline to €731.2 million and rising operational costs.See it on page 1
02
Research and development expenditures reached €486.5 million, accounting for 66.5% of total revenue during the period.See it on page 22
03
Despite the revenue contraction, net bookings of €699.4 million exceeded internal targets, supported by the performance of the Rainbow Six Siege and Assassin’s Creed franchises.See it on page 4
04
The company recorded €61.8 million in non-recurring charges, primarily due to mobile division goodwill impairments and the shutdown of the Google Stadia platform.See it on page 22
05
Ubisoft maintains a liquidity position of €1.53 billion in cash and cash equivalents against a net financial debt of €658 million.See it on page 33
06
Management projects a return to profitability for the full fiscal year, targeting a non-IFRS operating income of approximately €400 million.See it on page 4
07
Strategic efforts to bolster market position include an expanded partnership with Tencent and ongoing employee shareholding initiatives.See it on page 17

Summary

Ubisoft’s financial performance for the first half of fiscal year 2023 reflects a period of strategic transition characterized by a slight contraction in revenue and a net loss of €190.1 million. Total revenue reached €731.2 million, representing a 2.7% decline largely attributed to a downturn in physical sales. Despite these headwinds, net bookings of €699.4 million surpassed internal targets, bolstered by the enduring commercial strength of core franchises such as Rainbow Six Siege and Assassin’s Creed. The company maintains a stable capital structure, supported by €1.53 billion in cash and cash equivalents, which offsets a net financial debt of €658 million.

Operational expenditures rose significantly during this period, with research and development costs climbing to €486.5 million, or 66.5% of total revenue. This increase, coupled with €61.8 million in non-recurring charges—stemming primarily from mobile division goodwill impairments and the cessation of the Google Stadia platform—contributed to a non-IFRS operating loss of €139.0 million. Furthermore, the company continues to navigate ongoing tax audits in Canada and Spain, though management maintains that the risk of material financial impact remains low.

Looking ahead, the company remains committed to its fiscal year 2022-23 outlook, projecting significant growth in net bookings and a non-IFRS operating income of approximately €400 million. This optimism is anchored in a robust pipeline of upcoming title launches, strategic mobile licensing partnerships, and favorable currency exchange dynamics. The recent expansion of the partnership with Tencent and the successful execution of employee shareholding initiatives underscore a broader effort to solidify the company’s market position and long-term operational resilience within the global interactive entertainment sector.