Sales figures, studio takeovers, financial statements, developer transfer window, investments… if these topics interest you, you’ve come to the right place. We offer you an update on the business news of the past week.
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 over the period from April to June 2022. It’s simple, turnover fell from 2.2 billion d euros to 1.6, while operating and net profits fell respectively from 943.9 million to 329.3 and from 853.9 to 272.9 million.
Results which are partly explained by a 25% increase in the workforce and the takeovers 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. The publisher has indeed announced that the FPS had sold less well than Black Ops Cold War, itself less sold than the Modern Warfare of 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 which recently passed the 100 million dollar mark. In total, and as of June 30, 2022, the entire Activision-Blizzard-King group claims 361 million active users against 408 million on 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 confident, with many major productions arriving by 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 finances before the effective takeover of the group by Microsoft, which must still obtain the approval of the authorities.
Founded in 1994 by Franz Koch and Dr. Klemenz Kundratitz, Koch Media (pronounced Korr Media) is a German publisher and distributor. Better known for 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 nearly thirty years of activity, publishing or distributing SEGA or SNK games, the Koch Media company felt the need to renew itself, and to better reflect the developments since its acquisition by Embracer in 2018. for 120 million euros. This renewal does not go through a modification of activities, but through a brand new visual identity, associated with a new name, Plaion. If you’re wondering, it’s pronounced “Play On”, the i and the o being supposed to evoke the power on and off symbol.
It is more impactful, there is an external declaration but it is also an internal declaration for our employees. We are opening this new chapter, they are part of it, we are a modern, growing, ambitious global company, and it helps to 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, Managing Director.
This change also applies to the film branch of the company, which therefore becomes Plaion Pictures. For Deep Silver, the recently 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 declining quarter and a Switch that is still aiming for the heights
After two truly exceptional years in terms of results, Nintendo is marking time very slightly, but is posting an overall record of great stability, despite the shortages. Helped by Nintendo Switch Sports, Mario Strikers Battle League Football as well as Kirby and the Forgotten World, Nintendo’s turnover fell only 5% compared to spring 2021 to peak at 2.2 billion euros. 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 are 11.8 billion in turnover, at a level close to that of before the pandemic. At the same time, Nintendo proudly announced the distribution of 111 million Switches worldwide despite sales down 23% (officially due to shortages), and could approach 130 million if Nintendo’s forecast is right. . On the games side, 863 million Switch games have been distributed and bring 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 millions
- Animal Crossing : New Horizons – 39,38 millions
- Super Smash Bros. Ultimate – 28,82 millions
- The Legend of Zelda : Breath of the Wild – 27,14 millions
- Pokémon Sword and Pokémon Shield – 24.50 million
- Super Mario Odyssey – 23,93 millions
The mobile branch of Nintendo accuses the blow, with a drop 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 the games sold are Nintendo stamped, and 53% of the total was sold digitally. Over the past 12 months, 104 million people have used a Switch, which means that buyers use their console regularly.
Bandai Namco: Elden Ring takes care of everything
Sacred spring quarter that has just signed Bandai Namco, in the midst of publishers whose income has fallen. 1.5 billion euros in turnover, 325.7 million in operating profit and 271.6 million in net profit against 153.4 million in 2021, all is well for the publisher, which can count on its activity video games and more specifically on Elden Ring, which has sold more than 13 million units worldwide since its release in February.
The first activity remains that of toys and other derived products, but this is not our subject. 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 objectives, including the distribution of 43.5 million games, have been raised for the first fiscal quarter.
Bandai Namco now mentions an operating profit of 528 million euros (against 337 initially) and a turnover of 3.1 billion euros instead of 2.9 billion. According to the report published within the framework of these financial results, Gundam, Dragon Ball and One Piece are the hens 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 of Epic Games, majority shareholder of Riot Games and placed at Activision-Blizzard, Epic Games, Paradox, Roblox, Dontnod, Krafton, Klein (Don’t Starve), Bohemia ( ArmA), Voodoo and Frontier, would consider investing even more in Ubisoft. Having had a 5% stake in the company since 2018, Tencent has reportedly approached Ubisoft to take a bigger, much bigger stake.
According to information from Archyde.com, 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. Obviously, and in view of the reliability of Archyde.com, the markets very quickly caught fire, causing the short price to rise by 12.66% on the Paris Stock Exchange, reaching a maximum of €48.88. To situate, before the rumor, the action was sold for 42.19 euros, and only 34.56€ in April. For the moment, no official announcement has come to confirm or deny this rumor, but the reaction of the market suggests that it is particularly solid.
Recall that in China, Tencent has seen its activity slow down 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 label, called Level Infinite, whose logo has already appeared on many titles (PUBG Mobile, Don’t Starve: Newhome, GTFO…)
Briefly in the business news of the week
- Square Enix’s turnover and operating profit are therefore down 15% and 16%. Final Fantasy XIV continues to carry the business, and a big schedule of upcoming releases should kick all that up again.
- SEGA sales grew 11% in the first fiscal quarter. Results are slightly below expectations (484 million euros in turnover), but remain solid according to management
- Konami’s operating profit fell by 30% during the April-June quarter despite the increase in turnover of 2% (525.5 million euros)
- One Piece Pirate Warriors 4 sold over two million units worldwide
- Sony is concerned about the takeover of Activision by Microsoft, in particular because of the weight of Call of Duty in the industry and the clear progression of Game Pass.
- Activision Blizzard has been accused by some employees of fighting against the union that is trying to be born within the studio dedicated to Diablo in Albany. The company would have appealed to Reed Smith, a law firm accused of setting up “union avoidance”.
- Horizon Forbidden West (PS5) has regained the lead in the ranking of sales in 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)