Ubisoft Faces Rehaul, Layoffs Amid Investor Pressure

Following a string of underperforming releases and setbacks, Ubisoft faces pressure from a minority investor, Aj Investment, demanding a complete restructuring. This includes installing new leadership and significant staff reductions.

Ubisoft Faces Investor Pressure for Restructuring

Aj Investment Claims Last Year's Layoffs Insufficient

In an open letter, Aj Investment, a significant minority shareholder, expressed deep dissatisfaction with Ubisoft's performance and strategic direction. The letter cites the delay of key titles like Rainbow Six Siege and The Division until late March 2025, alongside lowered Q2 2024 revenue projections and overall poor performance, as major concerns. Aj Investment directly called for a change in leadership, proposing a new CEO to optimize costs and studio structure for improved agility and competitiveness.

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

Aj Investment's letter criticizes the current management for prioritizing short-term gains over long-term strategic planning and gamer experience. The investor specifically highlighted disappointment with the cancellation of The Division Heartland and the underwhelming reception of Skull and Bones and Prince of Persia: The Lost Crown. While acknowledging the success of Rainbow Six Siege, the letter points out the underutilization of other popular franchises like Rayman, Splinter Cell, For Honor, and Watch Dogs. Even the highly anticipated Star Wars Outlaws, while expected to boost sales, received mixed reviews suggesting a rushed release. This, coupled with underperforming sales, contributed to the company's share price hitting its lowest point since 2015.

Aj Investment's Juraj Krupa further advocated for significant staff reductions, citing the higher revenue and profitability of competitors like Electronic Arts, Take-Two Interactive, and Activision Blizzard, despite employing fewer staff. Ubisoft's workforce of over 17,000 is significantly larger than its competitors. Krupa urged for cost-cutting measures and studio optimization, suggesting the sale of studios not crucial to core IP development. He emphasized that the current 10% workforce reduction and planned cost-cutting measures are insufficient to regain competitiveness in the global market. The investor believes that Ubisoft's current structure of over 30 studios is overly extensive and unsustainable.