Activision-Blizzard, Nintendo, Tencent and Ubisoft… This week’s business news

Sales figures, studio acquisitions, accounts, developer transfer window, investments… if these topics interest you, you’ve come to the right place. We offer you an update on the past week’s business news.

Activision-Blizzard: profits melted in the second quarter

Last week, Sony, Microsoft, Capcom and Ubisoft presented their financial results, and it was Activision-Blizzard-King’s turn to do so earlier this week. After two years of record results against the backdrop of a pandemic, the publisher announced a sharp drop in results in the period from April to June 2022. It’s simple, revenue fell from 2.2 billion d euros to 1.6, while operating and net profit fell respectively . from 943.9 million to 329.3 and from 853.9 to 272.9 million.

Results that can partly be explained by a 25% increase in the workforce and the acquisitions of Proletariat and Peltarion, but also and above all by the “poor” performance of Call of Duty: Vanguard and the decline of World of Warcraft. Indeed, the publisher has announced that the FPS had sold less well than Black Ops Cold War, even less sold than Modern Warfare in 2019. The number of active users of Activision has also increased from 127 million to 94 a year earlier, while this number increased by 5 million between March and June for Blizzard, which is benefiting from the launch of Diablo Immortal, the free-to-play game that recently passed $100 million. In total, and per June 30, 2022, the entire Activision-Blizzard-King group claims 361 million active users against 408 million at the same date last year.

However, King remains in the green with even more active users than in 2021 (240 million). However, Activision-Blizzard-King can be sure, with many big productions coming at the end of the year and then next year: Call of Duty: Modern Warfare 2, Call of Duty: Warzone 2.0, World of Warcraft: Wrath of the Lich King Classic, World of Warcraft: Dragonflight and Overwatch 2, and Diablo 4 which awaits its time in 2023. What to give a boost to the economy before the effective takeover of the group by Microsoft, which still needs to obtain the approval of the authorities.

Koch Media (pronounced Korr Media) was founded in 1994 by Franz Koch and Dr. Klemenz Kundratitz and is a German publisher and distributor. Better known to some through its subsidiary, Deep Silver, the company itself belongs to the now sprawling Embracer Group, which also owns THQ Nordix, Gearbox, Coffee Stain, Saver Interactive or even Easybrain. But now, after almost thirty years of activity, publishing or distributing SEGA or SNK games, the Koch Media company felt the need to renew itself and better reflect the development since the acquisition of Embracer in 2018. for 120 million euros. This renewal does not go through a change of activities, but through a completely new visual identity, associated with a new name, Plaion. In case you’re wondering, it’s pronounced “Play On”, the i and o are supposed to evoke the on and off symbol.

It’s more impactful, there’s an external statement, but it’s also an internal statement for our employees. We’re opening this new chapter, they’re part of it, we’re a modern, growing, ambitious global company, and that helps energize people internally. Obviously, we want to avoid people seeing this as a facade. The signal we send is that we are “on a journey”, and it is good to give this journey a new name, a new visual appearance. New is always exciting, says Klemens Kundratitz, CEO.

This change also applies to the company’s film division, which therefore becomes Plaion Pictures. For Deep Silver, the newly created label Prime Matter, Ravensourt, Milestone and Vertigo Games, this change should have no impact, which will make it easier for everyone to understand when the reboot of Saints Row launches on August 23rd.

Nintendo: A down quarter and a Switch still aiming for the heights

After two truly exceptional years in terms of results, Nintendo marks the time very little, but posts an overall record of great stability despite the shortcoming. Helped by Nintendo Switch Sports, Mario Strikers Battle League Football, and Kirby and the Forgotten World, Nintendo’s revenue fell just 5% compared to spring 2021 to a peak of €2.2 billion. Net profit rose from 884 million to 750.6 million euros, while net profit rose from 685.1 million to 878.9 million euros.

The firm also presented its projections for the fiscal year, which is 11.8 billion in revenue, at a level close to the level before the pandemic. At the same time, Nintendo proudly announced the distribution of 111 million switches worldwide, despite a decrease of 23% (officially due to shortages), and could approach 130 million if Nintendo’s forecast holds. . On the gaming side, 863 million Switch games have been distributed, bringing the hybrid console closer to the DS, for which 948 million games have been distributed. The top 6 best selling games are now as follows:

  • Mario Kart 8 Deluxe – 46.82 million
  • Animal Crossing: New Horizons – 39.38 million
  • Super Smash Bros. Ultimate – 28.82 million
  • The Legend of Zelda: Breath of the Wild – 27.14 million
  • Pokémon Sword and Pokémon Shield – 24.50 million
  • Super Mario Odyssey – 23.93 million

The mobile division of Nintendo accuses the blow, with a decrease of 16% in income, with a turnover of only 80 thousand euros. More generally, the dematerialized, which includes the sale of games, subscriptions and additional content, reached a turnover of 650 million euros, an increase of 16%. 76% of games sold are Nintendo-branded, and 53% of the total were sold digitally. Over the past 12 months, 104 million people have used a Switch, meaning buyers are using their console regularly.

Bandai Namco: Elden Ring takes care of everything

Holy Spring Quarter, which has just signed Bandai Namco, amid publishers whose income has fallen. 1.5 billion euros in revenue, 325.7 million in operating profit and 271.6 million in net profit against 153.4 million in 2021, everything is good for the publisher, which can count on its activity video games and more specifically Elden Ring, which has sold more than 13 million units worldwide since its release in February.

The first activity is still toys and other derivative products, but that is not our topic. For games, we are talking about the distribution of 11.4 million games, with half as many titles as last year at the same time. The targets, including the distribution of 43.5 million games, have been raised for the first fiscal quarter.

Bandai Namco now mentions an operating result of 528 million euros (against 337 in the first instance) and a turnover of 3.1 billion euros instead of 2.9 billion. According to the report published in the framework of these financial results, Gundam, Dragon Ball and One Piece are the chickens with the golden eggs of the brand, with 413 million euros generated.

Tencent, future majority shareholder of Ubisoft?

This is one of the big rumors of the week. Tencent, the huge Chinese holding company, 40% shareholder in Epic Games, majority shareholder in Riot Games and placed in Activision-Blizzard, Epic Games, Paradox, Roblox, Dontnod, Krafton, Klein (Don’t Starve), Bohemia (Arma), Voodoo and Frontier, would consider investing even more in Ubisoft. After holding a 5% stake in the company since 2018, Tencent has reportedly approached Ubisoft to take a bigger, much bigger stake.

According to information from Reuters, Tencent would be ready to put 100 euros per share, while the share price in 2018 was 66 euros, and to buy the shares of other shareholders to establish its position. Clearly, and given the reliability of Reuters, the markets caught fire very quickly, sending the short up 12.66% on the Paris exchange to hit a high of €48.88. To place, before the rumor, the action was sold for 42.19 euros and only 34.56€ in April. At the moment, no official announcement has come to confirm or deny this rumor, but the market reaction suggests that it is particularly solid.

Keep in mind that Tencent in China has seen its activity slow due to new laws and restrictions, and that the company is increasingly looking internationally to guarantee its growth. It even recently launched a brand new international publishing company called Level Infinite, whose logo has already appeared on many titles (PUBG Mobile, Don’t Starve: Newhome, GTFO…)

Short in the week’s business news

  • Square Enix’s sales and operating profit therefore fall by 15% and 16%. Final Fantasy XIV continues to carry the business, and a big schedule of upcoming releases should get things moving again.
  • SEGA sales grew 11% in the first fiscal quarter. The results are slightly below expectations (484 million euros in revenue), but remain solid according to management
  • Konami’s operating profit fell 30% in the April-June quarter despite the 2% rise in revenue (525.5 million euros)
  • One Piece Pirate Warriors 4 sold over two million units worldwide
  • Sony is worried about Microsoft’s takeover of Activision, especially because of the weight of Call of Duty in the industry and the clear development of Game Pass.
  • Activision Blizzard has been accused by some employees of fighting the union that is trying to be born in the studio dedicated to Diablo in Albany. The company would have appealed to Reed Smith, a law firm accused of creating “union avoidance.”
  • Horizon Forbidden West (PS5) has regained the lead in the ranking of sales by value in France according to SELL (week 29). Guerrilla’s game beats Mario Strikers: Battle League Football, Mario Kart 8 Deluxe, Live A Live and Gran Turismo 7 (PS5)

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