Ubisoft Stock Hits 14-Year Low After Game Cancellations and Major Restructuring

Ubisoft is facing its most severe financial crisis in more than a decade, as the European gaming giant saw its stock price plunge by over 34 percent in a single trading day. The sharp decline followed an announcement from CEO Yves Guillemot outlining a large-scale corporate restructuring aimed at stabilizing the struggling company.

Ubisoft shares dropped to approximately 4.40 USD, marking their lowest point since 2011, a year previously associated with major financial losses for the company.

Six Games Canceled, Major Projects Delayed

The restructuring plan delivered a major shock to fans and investors alike. Ubisoft confirmed the cancellation of six games currently in development, including the long-awaited Prince of Persia: The Sands of Time Remake. In addition, seven other projects have been delayed, as the company shifts focus toward its most profitable franchises.

Moving forward, Ubisoft plans to concentrate development efforts on core brands such as Assassin’s Creed, Far Cry, and Rainbow Six, reorganizing its studios under a new internal structure referred to as Creative Houses.

Internal Backlash and Labor Tensions

Beyond game cancellations, Ubisoft is facing significant internal resistance. Cost-cutting measures include potential layoffs and a mandatory return-to-office policy requiring employees to work onsite five days per week.

These decisions have drawn strong criticism from labor unions, with Solidaires Informatique, a French workers’ union, calling for immediate strike action. The union described the company’s leadership decisions as disastrous and damaging to employee morale.

Investor Concerns Over AI and Financial Losses

Investors are particularly concerned about Ubisoft’s increasing reliance on generative AI in game development. While the company claims this approach will create new player experiences, the market largely views it as a short-term cost-reduction strategy.

These concerns are compounded by the underperformance of recent major releases such as Star Wars Outlaws, which failed to meet sales expectations. Ubisoft now projects an operating loss of approximately 1.1 billion USD for the current fiscal year, further eroding investor confidence.

Falling Behind Industry Rivals

Ubisoft’s struggles stand in stark contrast to competitors across the global gaming industry. While publishers like Electronic Arts benefit from strong external investment and Activision Blizzard operates under Microsoft’s umbrella, major Asian publishers such as Tencent, Capcom, and Nexon continue to report stable growth and strong financial results.

By comparison, Ubisoft’s market value has declined by more than 90 percent from its peak in 2018, highlighting the scale of its downturn.

An Uncertain Road Ahead

Speculation continues around potential acquisition talks or even the possibility of taking Ubisoft private to facilitate internal restructuring away from public market pressure. However, in the short term, both players and investors will be closely watching whether this organizational reset can realistically return the company to profitability by its stated target year of 2027.

For now, Ubisoft stands at a critical crossroads, facing questions not only about its financial recovery but also about the future of one of gaming’s most influential publishers.

Source: PC Gamer