Ubisoft Entertainment shares surged on Friday after the Assassin’s Creed maker said it is on track to achieve record sales for the financial year ending in March, in an announcement that assuaged investors’ fears that it would cut its guidance for the full-year 2024.
In results published late on Thursday, Ubisoft confirmed its outlook for the financial year 2024 on the back of strong financial results for the three months ending in December that saw it surpass its own €610 million bookings guidance, in generating net bookings worth €626.2 million.
The French video game maker said it is now set to achieve its own guidance for the full year 2024 and post “strong topline growth” following the successful launches of new titles including “Prince of Persia: The Lost Crown” and “Assassin’s Creed Mirage.”
Shares in Ubisoft UBI, +18.37% surged 19% on Friday following a turbulent period for the stock which had previously plunged in value in 2024 so far.
In the financial year ending in March 2023, Ubisoft previously posted a record loss, due to a sharp drop in sales caused by the end of a COVID-19 related boom. The company’s share price decline was worsened by a series of delays and game cancellations that saw it lose €500.2 million last year.
The Paris headquartered company said it now expects to meet its guidance and generate €400 million worth of income in the full-year ending in March 2024, on the back of its guidance beating bookings, despite investors fears it would make a guidance cut.
“With the stock down ~30% within 4 months and short interest likely high given the anticipation of a material cut, these stronger-than-expected results should help restore positive sentiment in the name – especially as we look out to the impressive pipeline of games in FY-25,” Deutsche Bank analysts led by Jenny Voigtlaender said.
In the three months ending in March, Ubisoft saw its net booking increase by 43.1%, in an uptick the company attributed to strong demand for its new releases, despite the underwhelming performance of “Avatar: Frontiers of Pandora” which was released on Dec. 7 2023.
Ubisoft’s bookings were also bolstered by the strength of its back catalog, which include games such as the 2016 title “Tom Clancy’s Rainbow Six Siege” which saw playtime increase 60% year on year.
“The latest Assassin’s Creed game, Mirage, is a big factor behind the company’s robust quarterly performance. Chief executive Yves Guillemot says the company is going to start consistently delivering good games again. Which begs two obvious questions: why didn’t they think of that before and if it was that easy, why weren’t they already?” AJ Bell analysts led by Russ Mould said.
Looking ahead, Ubisoft said the release of new games including Star Wars Outlaws and Assassin’s Creed Codename Red will boost its sales in the financial year 2025.