Ubisoft is one of the largest developers and publishers of video games, but it has been in crisis for some time. Franchises like The Division or Assassins Creed come from the French company. CEO Yves Guillemot wanted to call for more dedication and cost sensitivity in a message to his employees. However, he miscalculated with the French union “Solidaires Informatique” – they want to strike directly.
The ship combat MMO Skull & Bones probably stands like no other project for the current crisis in which Ubisoft finds itself. The title has already been postponed 6 times – currently to an indefinite date in the Ubisoft fiscal year 2023/24.
However, the bare numbers also speak against one of the largest developers and publishers of games. Recently, the company announced that it would likely incur losses of more than 500 million euros in the fiscal year 2022/23 (via bloomberg.com). Ubisoft’s fiscal year always runs until March.
With revenues of just over 2.1 billion euros in the fiscal year 2021/22, losses of over 500 million euros in the following year are a heavy blow. Even if the company states that there are still more than 1 billion euros in reserves on the balance sheet: Ubisoft must act, turn the tide.
Ubisoft CEO Yves Guillemot surely has a few plans up his sleeve for that. However, a current measure is meeting with little approval from his employees. Guillemot wrote a letter to his workforce, which the US site Kotaku has seen (via kotaku.com).
It states, for example, “the ball is in their court” and that they should pay more attention to which costs are really necessary. Following this, a French union directly calls for a strike.
One of the newer Ubisoft projects is the mobile shooter The Division: Resurgence. Check out a trailer here:
Ubisoft CEO tells employees: “The ball is in their court”
What was in the letter? The essence of the letter is the indication that the fiscal year 2023/24 will be crucial for the future of the company and the request to fully engage. They have “the largest pipeline in the history of Ubisoft,” says CEO Guillemot.
“I need your full energy and commitment today more than ever to get back on track” and “The ball is in their court to deliver this line-up on time and in the expected quality and to show everyone what we can achieve.”.
Guillemot states that the release delays in Ubisoft’s portfolio are the main reason for the current imbalance. They now need the full support of the employees to get out of this situation.
In addition, they want to divest from parts of the company that do not belong to the core business and create more sensitivity for costs in daily business: “I also ask each of you to be particularly careful and strategic with your spending and initiatives to ensure that we are as efficient and lean as possible.”.
Union will not accept pressure on employees
What does the union say about it? For the French Solidaires Informatique, the letter is a clear declaration of war on the employees. The employee association accuses the CEO of the letter being a PR measure, behind which very different actions are hiding.
When Guillemot talks about restructuring, the union understands:
- Staff reductions
- Discrete studio closures
- Salary cuts
- Concealed layoffs
In addition, the CEO’s attitude is criticized, that the employees are now responsible for pulling the cart out of the mud. The union concludes that this leads to:
- Overtime
- Pressure from management
- Burnout
The corresponding letter was published, among other places, on Twitter:
What is the union demanding? Solidaires Informatique reacted with drastic demands to improve the working quality of French employees. The demands are already included in the linked document.
It is about:
- An immediate 10% increase in all salaries
- Introduction of a 4-day work week
- Transparency regarding workplace development
- Ending concealed layoffs
To emphasize the demands, Solidaires Informatique has called for a strike. On January 27, employees in Paris are supposed to stop working from 2 to 6 PM.
Could Ubisoft go under? The company has long been viewed as a takeover candidate in the gaming sector because it is among the smaller of the major video game publishers. Companies like Amazon, Tencent, Sony, or Microsoft have significantly larger resources for their plans.
Even Activision Blizzard (CoD, WoW) wants to go to Microsoft because it sees itself as too small. EA (FIFA, Battlefield) could also be swallowed by a larger company sooner or later.
Currently, the future of Ubisoft is as uncertain as never before in the company’s history, and much seems possible – from a complete sale to the complete dismantling to a “business as usual”.
What is clear, however, is that the corporate communication is not currently functioning smoothly. There have apparently been problems for some time now: Ubisoft says about NFTs: “They are really beneficial. But you just don’t get it right now.”
