Ubisoft exceeds expectations in the 1st semester with Assassin's Creed and Tencent agreement

Ubisoft announced financial results for the first half (H1) of Fiscal Year 2025-26 "above expectations", driven by "stronger partnerships than expected" and the strong performance of the Assassin's Creed franchise. The positive news comes after a week of speculation caused by a formal delay in profit disclosure and a halt in stock trading due to a reaffirmation of profits for FY 2024-2025.

The performance was driven by the back-catalogue (€741.4 million, 50% year-over-year increase) and digital net bookings (€685.8 million, 30.2% year-over-year increase). Total net bookings reached €772.4 million (20.3% year-over-year increase). In terms of non-IFRS operating profit, the company recorded €27.1 million (compared to -€252.1 million in the previous year).

CEO Yves Guillemot highlighted the contrasting performance: "Our portfolio exhibited contrasting dynamics this quarter, with softer trends for Rainbow Six Siege, reflecting an evolutionary phase for the game in an intense FPS environment, offset by strong performances across the rest of the catalogue." Assassin's Creed Shadows was "better than expected", and the Assassin's Creed franchise exceeded expectations, with a free update for Assassin's Creed Mirage increasing the total players to 10 million.

Ubisoft confirmed that the closure of its €1.16 billion partnership with Tencent is "imminent", with "all conditions precedent satisfied". This capital infusion will be used to pay off Ubisoft's net debt, which stands at €1.15 billion. The deal will result in the creation of the subsidiary Vantage Studios, which will own Ubisoft's primary brands (Assassin’s Creed, Far Cry, and Rainbow Six), with Tencent acquiring 25%.

The creation of Vantage is the first part of Ubisoft's reorganization into Creative Houses ("autonomous, efficient, focused, and responsible business units"). The remaining houses will be announced in January 2026.

The company is also "on track" with cost reduction, targeting an additional €100 million fixed cost savings for FY 2026-27 compared to FY 2024-25, through restructuring and "continued discipline in hiring". The company's global workforce decreased to 17,097 by the end of September 2025, reflecting a loss of 1,500 employees in the past 12 months (700 cuts since March 2025), including cuts in Nordic studios like RedLynx and Massive Entertainment.

Ubisoft mentioned that Rainbow Six Siege fell short of revenue expectations due to a "temporary increase in cheating", which the company is addressing. The success of the Netflix series Tom Clancy’s Splinter Cell: Deathwatch and the positive reviews of Anno 117: Pax Romana also boosted the "solid growth in consumption".

With the sale of part of its major franchises to Tencent and the layoff of 1,500 employees aiming at cost savings, will Ubisoft be able to reverse the decline in its stock value (from €85 to €6.77 in five years) and sustain revenue growth solely through reorganization and the back-catalogue?