fy-2010-11
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Atari seeking to sell Cryptic Studios as another fiscal year ends in losses
In its 2010–11 fiscal year earnings report today, Atari announced it will be dropping, er, "divesting" MMO developer Cryptic Studios. The publisher accounted for the studio under its "discontinued operations" in the report. In other words, it's trying to sell Cryptic. Overall, Atari reported a net loss of €6.2 million ($8.8 million) for this fiscal year that ended March 31, 2011 -- an admitted improvement over the €19.4 million lost in the previous fiscal year. Cryptic alone was responsible for €5.3 million ($7.5 million) in losses during fiscal 2010–11. Representatives for Atari and Cryptic declined to offer any statements beyond those in today's financial report. Cryptic's Champions Online went free-to-play earlier this year, and the studio is currently working on a Neverwinter MMO and "Season 4" of Star Trek Online. Atari purchased the developer in 2008 during an optimistic period for the publisher.
Ubisoft continues to just dance around fiscal year losses
A year ago, as Ubisoft reported net losses of €43.671 million for its 2009–10 fiscal year (ending, March 31, 2010), CEO Yves Guillemot brushed aside concern, saying, "We forecast a return to profitable growth in 2010–11." Well, here we are -- and Ubisoft isn't exactly basking in the sun. For the 2010–11 fiscal year ending March 31, 2011, the publisher's net losses slumped further to €52.120 million (about $74 million). Yet Guillemot again played the role of the optimistic fortuneteller as he looked to the company to "post further growth in both sales and current operating income in 2011–12 and 2012–13." (Notice how he didn't drop the P-word this time.) He put a positive spin on the 2010–11 fiscal year, too, observing "a sharp upturn in revenue." Indeed, sales were up 19 percent over the previous fiscal year to €1.039 billion. In addition to "another success" with Assassin's Creed: Brotherhood, Guillemot attributed much of the sales growth to a rebounding casual market, which Ubisoft dominated with its (just) dance game segment, as well as strong support for the Kinect and 3DS launches. Notably, 38 percent of the publisher's game sales over the 12-month period came from Wii titles. Ultimately, Ubisoft's bottom line suffered from reorganization costs, which amounted to €95.9 million in non-recurring charges, including unspecified project terminations (so, Am I Alive?). Presumably, if Ubisoft is now appropriately restructured, it can focus more effectively on making successful products again. "For example," Guillemot offered, "we plan to launch a free-to-play world based on our highly popular franchise for young girls, Imagine."
Atari revenue down, but MMO business blooming
Without an equivalent of the Ghostbusters game, Atari's revenue for the nine-month period from April 1 through December 31, 2010 was, well, a bit busted. Through the first three quarters of its current fiscal year, the publisher has reported €41.0 million ($55.3 million) in revenue, down 55.7 percent from the same period in 2009. However, Atari doesn't seem too bugged by the decline. In its latest earnings release, CEO Jim Wilson said that current-year revenues are "in line with our outlook and show a continued shift toward fewer but more profitable retail releases and the growing online games market." And, in fact, Atari's online revenue has increased by €15.3 million year-over-year to €18.4 million ($24.8 million) through nine months, thanks to Champions Online and Star Trek Online. Revenue from online games represented a whopping 44.9 percent of Atari's total net revenue for the period, compared to just 3.4 percent in the first nine months of its previous fiscal year.
Dance games made it rain on Ubisoft's holiday quarter
Ubisoft today reported sales figures for its fiscal-year third quarter, which ended December 31, 2010. For the period, the French publisher recorded €600 million ($809 million) in total software sales, up just over 21 percent from the same quarter in 2009 (though factoring in constant exchange rates -- nearly 60 percent of sales were made in North America -- year-over-year growth was closer to 15 percent). In 2010's three-month holiday period alone, Ubisoft shipped a staggering 10.5 million copies of dance titles, which included Just Dance, Just Dance 2, Just Dance Kids, Michael Jackson: The Experience and Dance on Broadway. Additionally, the company claimed an 18 percent market share of the Kinect platform in the US (and 21 percent in Europe), following its push to become the "top third-party publisher" for Microsoft's successful motion-control add-on. Ubisoft put its Kinect game shipments at over 2 million -- "a very nice level of profitability," CEO Yves Guillemot said in an investor call today -- for the fiscal third quarter. Add in all those copies of Assassin's Creed: Brotherhood, and Ubisoft outsold its projected quarterly sales total by €80 million ($108 million), bringing its nine-month fiscal 2010-11 year sales up to €861 million ($1.16 billion) -- a marked increase over the €661 million in sales generated during the same period in 2009, and making it a near certainty that the company will return to profitability at the end of its current fiscal year (on March 31, 2011). With a relatively quiet fourth quarter of scheduled releases, however, the publisher anticipates its total fiscal-year sales to reach only €1.02 billion. Still, "cash flow generation is expected to be positive."
Ubisoft's first half 2010 financials show improvement, still in the red
The first half of Ubisoft's 2010-11 fiscal year (from April 1, 2010 through September 30, 2010) showed positive growth comparatively with the company's fiscal first half of 2009-10, with sales up 57 percent to €260 million ($354.25 million) over last year. Despite the increased sales, the French publisher still spent the first six months of fiscal 2010 losing money -- €89.8 million ($122.08 million) in total. Accounting for an enormous chunk of the company's first-half loss was "studios' roles and operations reorganization," which we take to mean "we've been building and staffing up our new studio, Ubisoft Toronto." The recent closure of Ubisoft Brazil assuredly helped mitigate the expense of creating a new base of operation, though apparently not enough to keep Ubi in the black. Also to blame: Tom Clancy's HAWX 2 and Ruse both performed below the publisher's expectations, in addition to "higher R&D [research and development] than expected." CEO Yves Guillemot also explained, "The market environment continues to be tough and, although our gross profit rose sharply, the increase was lower than we expected and we had to accelerate depreciations on certain released titles." But with Assassin's Creed: Brotherhood, Just Dance 2, and Michael Jackson: The Experience all scheduled for launch in the third quarter of Ubi's fiscal year, the publisher is confident that Q3 will be profitable.
Atari sales and losses down in first half, online revenue up
The financial results for the first half of Atari's fiscal year have been released. The company reported net revenue of €29.6 million ($40.5 million) for the period, a substantial decline from the €68.5 million ($93.8 million) reported during the same period last year. Revenue was "in line with expectations" however, given Atari's new focus on "fewer but more profitable games." Speaking of profit, income has improved, though Atari isn't back in the black just yet. The company posted an operating loss of €8.5 million ($11.6 million), a considerable improvement over the €19.9 million ($27.2 million) loss during the same period last year. Atari expects income for the second half of the year to be "slightly negative to break even." Highlighting the shift toward more online and downloadable games, Atari noted that online revenue including subscription fees for Star Trek Online and Champions Online totaled €12.9 million ($17.6 million), comprising 43.6 percent of its overall revenue. During the same period last year, online revenue totaled only €1.8 million ($2.4 million), or 2.6 percent of overall revenue.
Atari sales down in Q1, online is the glimmer of hope
Atari announced that revenues were down 65 percent to €19.3 million ($25M) in the first quarter of its fiscal year ending June 30, 2010. The company didn't reveal any profit or loss data, but given its loss during the previous fiscal year, it's pretty safe to guess that Atari isn't doing so hot. Last year's Q1 included Ghostbusters and The Chronicles of Riddick: Assault on Dark Athena, while this year had, according to the company, "only one major game" ... Sandlot Sluggers. A small piece of "good news" during the quarter, which also included another major executive shuffle at the publisher, was that online revenues were up 320 percent to €8.4 million ($10.9M). The much-needed money injection was thanks to digital distribution sales and subscriptions for Star Trek Online and Champions Online. Some of the hopes Atari has for the rest of the year include the reboot of Haunted House in September, The Witcher 2 next spring and "numerous casual and social online game releases based upon Atari's classic video game brands."
Ubisoft fiscal Q1 sales up 94% over last year
Ubisoft has released a preliminary report on its fiscal first quarter, which ended June 30, revealing that software sales totaled €161 million ($207.8M). The company recorded a 94 percent revenue increase over the same period last year thanks to sustained sales of Assassin's Creed 2, Just Dance and Avatar. The company also reported "solid performance" from Splinter Cell: Conviction and shipped 1.9 million units of the game during the quarter. Ubisoft will reveal actual profit (or loss) figures for the quarter at a later date. The company expects sales in the second quarter, which concludes at the end of September, to be flat year-over-year at an estimated €83 million ($107M). The company's Q2 releases are "highlighted" by plans to ship HAWX 2, Racquet Sports and R.U.S.E. -- although the strategy game has been known to live up to its name when it comes to sticking to a release date.
