Following a series of setbacks and disappointing recent game releases, Ubisoft faces pressure from a minority investor, Aj Investment, demanding a complete management overhaul and staff reductions.

Ubisoft Under Pressure for Restructuring

Aj Investment Claims 10% Workforce Cut Insufficient

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

The letter cites concerns over delayed major game releases (Rainbow Six Siege and The Division pushed to late March 2025), lowered Q2 2024 revenue projections, and overall poor performance. These factors, according to Aj Investment, raise serious doubts about the current management's long-term viability and ability to deliver shareholder value. The investor even proposed replacing Guillemot as CEO, advocating for a new leader to optimize costs and studio structure for enhanced agility and competitiveness.

Ubisoft's share price has suffered, plummeting over 50% in the past year, according to the Wall Street Journal. The company has yet to respond to the letter.

Aj Investment criticizes Ubisoft's management, claiming the company's low valuation stems from mismanagement and that shareholders are held captive by the Guillemot family and Tencent. They argue that the current focus on short-term quarterly results overshadows a long-term strategy for delivering exceptional gaming experiences.

Aj Investment's Juraj Krupa further expressed disappointment over the cancellation of The Division Heartland and criticized the underwhelming reception of Skull and Bones and Prince of Persia: The Lost Crown. He also highlighted the underperformance of several established franchises, such as Rayman, Splinter Cell, For Honor, and Watch Dogs, despite their popularity. While Star Wars Outlaws was anticipated to boost performance, its initial sales have fallen short of expectations, contributing to the recent share price decline – its lowest point since 2015.

The letter also proposes significant staff reductions. Krupa points to competitors like EA, Take-Two Interactive, and Activision Blizzard, which achieve higher revenue and profitability with smaller workforces. Ubisoft's 17,000+ employees dwarf EA's 11,000, Take-Two's 7,500, and Activision Blizzard's 9,500, despite having fewer blockbuster titles.

Krupa urges aggressive cost-cutting measures and staff optimization to improve operational efficiency. He suggests selling studios not essential to core IP development, noting that Ubisoft's 30+ studios represent an overly large and unprofitable structure. While acknowledging past layoffs (approximately 10% of the workforce), he asserts that further, more substantial reductions are necessary to remain competitive. He also points out that the announced cost-cutting targets of €150 million by 2024 and €200 million by 2025 are insufficient.