Sales figures, studio buyouts, 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
- Koch Media (Saints Row): new name for a new life
- Nintendo: A down quarter and a Switch that is still aiming for the heights
- Bandai Namco: Elden Ring takes care of everything
- Tencent, future majority shareholder of Ubisoft?
- Briefly in the business news of the week
- Our other business articles of the 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 sharply lower results over the period from April to June 2022. It’s simple, the turnover has gone from 2.2 billion euros to 1.6while 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 Call of Duty: Black Ops Cold War, itself less sold than the Call of Duty: Modern Warfare of 2019. The number of active users of Activision has also passed from 127 to 94 million a year earlier, while this number increased by 5 million between March and June for Blizzard, which benefited 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 on top, 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 2.0World of Warcraft Wrath of the Lich King Classic, World of Warcraft: DragonFlight and Overwatch 2, as well as Diablo IV, expected in 2023. What to give a boost to finances before the effective takeover of the group by Microsoftwhich must still obtain the approval of the authorities.
Founded in 1994 by Franz Koch and Dr. Klemenz Kundratitz, the company Koch Media (pronounced Korr Media), is a German publisher and distributor. Best known to some through its subsidiary, Deep Silver, the company itself is owned by the now sprawling Embracer Group, which also owns THQ Nordix, Gearbox, Coffee Stain, Saber Interactive or 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 ask yourself the question, it is pronounced ‘”Play On”, the i and the o being supposed to evoke the symbols power on and off.
It’s more impactful, there’s an external statement, but it’s also an internal statement 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, Prime Matter, a recently created label, Ravenscourt, Milestone and Vertigo Games, this change should not have no impactwhich 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 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 balance sheet of great stability, despite shortages. Helped by Nintendo Switch Sports, Mario Strikers: Battle League Football as well as Kirby and the Forgotten World, Nintendo’s revenue is down only 5% compared to spring 2021 for peak at 2.2 billion euros. Net profit rose from 884 million to 750.6 million euros, while net profit increased from 685.1 million to 878.9 million euros thanks to the exchange rate.
The firm also presented its projections for the fiscal year, which are 11.8 billion turnover, close to pre-pandemic levels. 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 forecasts are 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:
Nintendo’s mobile branch suffered the blow, with a 16% drop in revenues, with a turnover of 80 million euros only. 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 branded, and 53% of the total was sold electronically. 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 video game activity and more particularly 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 twice 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 evokes 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 as part of these financial results, Gundam, Dragon Ball and One Piece are the gooses that lay 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 companya 40% shareholder of Epic Games, majority shareholder of Riot Games and placed at Activision-Blizzard, Epic Games, Paradox, Roblox, Dontnod, Krafton, Klein, Bohemia, Voodoo and Frontier, would consider to invest even more in Ubisoft. With 5% of shares of 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 back the shares of other shareholders to establish its position. Obviously, and given the reliability of Reuters, the markets very quickly caught fire, making climb the price 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 the company’s growing international focus to ensure 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 revenue and operating profit are 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 have increased 11% in the first quarter tax. Results are slightly below expectations (484 million euros in turnover), but remain solid according to management
- Konami’s operating profit has melted by 30% during the April-June quarter despite the 2% increase in sales (525.5 million euros)
- One Piece: Pirate Warriors 4 sold over two million units worldwide
- Sony worries about Microsoft takeover of Activision especially because of the weight of Call of Duty in the industry and the clear progression of the Game Pass.
- Activision Blizzard has been charged par some employees to fight against the union which tries 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)