Ubisoft’s Stock Plummets After Recent Game Cancellations

If Ubisoft’s recent announcements about project cancellations, studio restructuring, and a pivot towards generative AI were meant to reassure shareholders, it’s clear that the strategy has backfired. As trading opened today, the company’s stock plummeted to its lowest point in 14 years, losing a third of its value overnight, following a long history of significant declines. To put it in perspective, a share purchased in June 2018 has now lost over 95 percent of its value.

In yesterday’s announcement, Ubisoft revealed the cancellation of projects like the Prince of Persia: Sands of Time remake, along with several unannounced titles, and outlined yet another restructuring plan for its development studios—essentially meaning more closures and layoffs. The company referred to these drastic measures as a shift towards “a radically new value-creation model,” and it certainly has been radical.

A detailed statement explained Ubisoft’s intentions to overhaul its entire structure and “simplify” operations, aiming to create “efficiency” and reassure investors that it will stop losing money. The plan emphasizes transforming established franchises into “annual billionaire brands” while also focusing on trendy concepts like live-service games and generative AI initiatives. However, simply claiming that games not currently generating close to a billion dollars annually will suddenly do so hasn’t instilled confidence in shareholders regarding the company’s future.

As of now, Ubisoft’s stock is hovering around $4.30, down from $6.60 just yesterday. This marks a significant drop from last year’s peak of $13.40 and an astonishing fall from the all-time high of $95 in 2018. The stock had remained relatively stable until January 2021, when it was still around $83, but since then, it has been on a relentless downward trajectory. This decline has coincided with the ongoing cancellation of major projects and repeated layoffs across its global studios.

This constant reshuffling doesn’t seem to be convincing anyone, and each new announcement has led to further price drops. The market’s reaction to the latest plans could result in one of the sharpest declines the company has ever experienced, unless there’s an unexpected recovery later today.

If you were considering selling your brand to a private owner, as EA is currently trying to do, this level of mismanagement would certainly make your assets appear much less valuable to potential buyers.