Gaming fail leaves Ubisoft stuck on takeover shelf

Reuters Reuters

(The author is a Reuters Breakingviews columnist. The opinions expressed are their own.)

LONDON (Reuters Breakingviews) - Video game maker Ubisoft Entertainment must be wondering how many lives it has left. Shares in the $7.9 billion Paris-listed developer of shoot-’em-ups such “Tom Clancy’s Rainbow Six” dropped 4% after it revealed a 17% year-on-year drop in quarterly revenue to 353 million euros on Tuesday. True, that was partly expected as gamers stepped away from their screens post-lockdown. And sales should recover given slated new releases linked to hot-selling franchises such as “Watch Dogs”. 

Still, with year-to-date share losses now totalling one-third investors may have deeper doubts about Chief Executive Yves Guillemot’s ability to tilt the company away from blockbuster titles and towards recurring subscriptions and free-to-play games. Ubisoft’s rich back catalogue of titles such as “Just Dance” would be valuable to a potential acquirer. And it’s cheap too: including net debt Ubisoft trades at around 15 times forward operating profit, a steep discount to U.S. rivals Electronic Arts and Activision Blizzard on 34 and 22 times respectively, according to Refinitiv data. Like the protagonist in his “Assassin’s Creed” title, Guillemot must tread carefully. (By Christopher Thompson)

On Twitter

Capital Calls - More concise insights on global finance:

Bridgepoint IPO shows rare private equity largesse

HKEX hoists welcome typhoon signal

BBQGuys go easy on the hot sauce

Apollo may help Fortress glide to Morrisons’ till

Unilever ties itself in knots over purpose

(Editing by Neil Unmack and Oliver Taslic)

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story


Latest Markets Videos


    Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at and via Reuters TV.

    Learn More