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Ubisoft Q2 Sales Up 25%, Wii Exclusive  Nitrobike  Delayed

Ubisoft Q2 Sales Up 25%, Wii Exclusive Nitrobike Delayed

October 23, 2007 | By Leigh Alexander, Brandon Boyer

October 23, 2007 | By Leigh Alexander, Brandon Boyer
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Ubisoft has announced its sales for the second fiscal quarter of 2008 (ending September 30th) totaled €127 million ($181.4 million), up about 25 percent over the same period last year, beating the company's own €105 million ($150 million) forecast.

The company attributes the strong performance primarily to the launch of a diverse range of games, specifically Tom Clancy's Ghost Recon Advanced Warfighter 2, Jam Sessions, Imagine: Master Chef, Blazing Angels and Surf's Up.

The company also credited strong sales levels for back catalog titles, comprising over 40 percent of overall sales. "We don’t have lots of amortization on those titles and it is helping tremendously," Ubisoft CEO Yves Guillemot commented on the company's call to investors.

According to Ubisoft, 75 percent of the company's sales came from next-generation console games, compared with 40 percent for the previous year.

Total sales for the six-month period ending September 30, 2007 totaled €261 million ($372.86 million), up 51 percent from the €172 million ($245.34 million) recorded for the same period in 2006.

Looking forward to a third-quarter lineup of Assassin's Creed, Haze, Naruto: Rise of a Ninja, Beowulf, and Rayman Raving Rabbids 2, in addition to a range of casual games centered around the Imagine, Petz and MyCoach labels, Ubisoft expects sales for third-quarter 2007-08 (ending December 2007) to come in at around €330 million ($470.71), representing a year-on-year increase of 6 percent.

However, the company announced that it would postpone the release of an four of its as yet unannounced games "as a result of the positive trends observed during the first half of the year as well as the positive outlook for the third quarter."

As a result, the company has six franchises and slated for release in 2008: Brothers in Arms, Far Cry, Rayman Raving Rabbids, The Settlers, Tom Clancy's Splinter Cell and an unannounced franchise, compared with the previously announced seven, and three new brands: Assassin's Creed, Haze and Tom Clancy's End War, compared with the previously-announced six.

The company also says it's confident it will achieve its previously announced targets for the entire fiscal year 2007-08, which include sales of approximately €825 million ($1.17 billion).

Said Guillemot, "Ubisoft has turned in a very solid first-half showing and has continued to win market share on new-generation consoles. For the first 9 months of the 2007 calendar year Ubisoft was ranked number 1 as the leading independent publisher for the Nintendo DS, as well as number 2 on Wii, number 3 for the PlayStation 3 system and PSP system, and number 4 for the Xbox 360 system."

He continued, "The strong sales performance and our positioning on high gross margin consoles has lead to a sharp profitability improvement for the first half of 2007-08. Finally, we have a particularly strong games portfolio for the rest of the fiscal year and we expect to reap the benefits of the recent PlayStation 3 and Xbox 360 hardware price reductions."

[UPDATE: Ubisoft has told Gamasutra that in addition to the four unannounced titles that will be moved into the next fiscal year, the previously announced Wii exclusive title Nitrobike from Nintendo 64 Excitebike developers Left Field has been pushed from this holiday season into a yet-unspecified following quarter.

In a call with investors, Guillemot stressed that the delay of the four yet unannounced titles was not necessarily due to development difficulties, instead adding, "We actually had enough products for the year, so we concentrated on the ones that were most important for the year."

Asked if Ubisoft studios were finding PlayStation 3 development difficult, Guillemot said that it has "made lots of progress on the PS3... It's very difficult to see the difference in terms of quality... Altogether we have a very good comparison on that machine."

He added that the company's new engines done for titles like Assassin's Creed, Far Cry and Beowulf were all now competently cross-platform between PC, PS3, and Xbox 360, and that as a result the company has already seen "costs going down by about 25 percent from the first to second generation" of next-gen titles.

Finally, asked about progress at its Montreal CGI studio, Guillemot said progress is continuing on the game engine to "make sure they can be used for creating TV series or movies."

The 80-member studio, he said, is still "working on two shorts, one on Assassin's Creed and another one on an unknown product," and that "learning how to create small movies is really helping us to understand what we have to do for this generation of games, and also the next generation."]

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