Ubisoft Facing Restructuring Amid Shareholder Pressure

Following a string of disappointing releases and underperformance, Ubisoft faces pressure from a minority investor to restructure its management and workforce.

Minority Investor Demands Ubisoft Overhaul

Aj Investment Claims Last Year's Downsizing Insufficient

Aj Investment, a significant minority shareholder, has publicly urged Ubisoft's board, including CEO Yves Guillemot and Tencent, to take the company private and install new leadership. In an open letter, they expressed profound dissatisfaction with the company's performance and strategic direction.

The letter cites the delayed release of key titles (Rainbow Six Siege and The Division, pushed to late March 2025), a lowered Q2 2024 revenue forecast, and overall poor performance as major concerns. Aj Investment explicitly called for Guillemot's replacement, proposing a new CEO to optimize costs and studio structure for improved agility and competitiveness.

This pressure has impacted Ubisoft's share price, which, according to the Wall Street Journal, has plummeted over 50% in the past year. Ubisoft has yet to publicly respond to the letter.

Aj Investment contends that Ubisoft's low valuation stems from mismanagement and the undue influence of the Guillemot family and Tencent. They criticized the company's focus on short-term gains over long-term strategic planning and delivering exceptional gaming experiences.

Aj Investment's Juraj Krupa further criticized the cancellation of Division Heartland and the underwhelming reception of Skull and Bones and Prince of Persia: The Lost Crown. He also highlighted the underperformance of several established franchises (Rayman, Splinter Cell, For Honor, Watch Dogs), despite their popularity. While Star Wars Outlaws was anticipated to boost performance, its release, according to Krupa, lacked polish, despite significant player anticipation.

Ubisoft's reliance on Star Wars Outlaws to reverse its fortunes has proven unsuccessful, contributing to a share price decline to its lowest point since 2015 – a drop exceeding 30% year-to-date.

The letter also advocates for significant staff reductions. Krupa points to the higher revenue and profitability of competitors (EA, Take-Two Interactive, and Activision Blizzard) despite smaller workforces. Ubisoft's 17,000+ employees contrast sharply with EA's 11,000, Take-Two's 7,500, and Activision Blizzard's 9,500.

Krupa urged for cost-cutting measures and staff optimization to improve operational efficiency, suggesting the sale of studios not crucial to core IP development. He considers Ubisoft's 30+ studios excessive and detrimental to future profitability. While acknowledging previous layoffs (approximately 10% of the workforce), Krupa argues that further, more aggressive measures are needed to ensure competitiveness in the global market. He also points out that planned cost reductions of €150 million by 2024 and €200 million by 2025 are insufficient.