By Geoffrey Smith
Investing.com -- Ubisoft (EPA: UBIP ) stock tumbled more than 20% in early trading on Thursday, as the videogames publisher canceled three new game launches and delayed another, writing off half a billion euros in R&D spending in the process.
The French-based publisher of Assassin's Creed and Tom Clancy's The Division slashed its forecast for booking in the current fiscal year to €725M (€1=$1.0764) from €830M previously, after the two launches on which it had pinned its hopes for the holiday season - Just Dance 2023 and Mario + Rabbids Sparks of Hope - both failed to live up to expectations.
That means a drop of around 10% from fiscal 2022, rather than the 10% increase it had previously forecast.
Ubisoft also again delayed the launch of Skull and Bones, another title in which it has heavily invested, this time pushing back the expected launch date into its 2024 fiscal year, which starts in April.
As a result of the write-offs and the launch delays, the company now expects a non-IFRS operating loss of €500M in the current fiscal year, rather than the €400M profit it had previously forecast. It expects non-IFRS operating income to rebound to €400M next year, as sales of Skull and Bones kick in and the company pursues €200M of cost savings.
After the initial shock, Ubisoft recovered a little in the course of European morning trading. By 06:00 ET (11:00 GMT), it was at an intraday high, but still down 15.6% from Wednesday's close.
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