The economic prospects for France's largest game developer Ubisoft are becoming gloomy.

After a series of forecast revisions, the company's share price plummeted by more than 20 percent on Thursday.

Niklas Zaboji

Economic correspondent in Paris

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Things have been going downhill for the past two years, and the share has lost around 80 percent of its value since January 2021.

Since then, the market value has shrunk from almost 12 to less than 3 billion euros.

Analysts reduced their price target on Thursday, some significantly.

On Wednesday evening, Ubisoft, which develops and distributes popular video games such as Far Cry, Anno and Assassin's Creed, had forecast an operating loss of 500 million euros for this fiscal year - after previously reporting a surplus of 400 million euros in the past had given prospect.

Instead of 10 percent more, 10 percent fewer net bookings are now to be expected.

Already in the past quarter, instead of 830 million euros, sales will probably have been only 725 million.

Ubisoft justified the forecast corrections with external difficulties and internal problems.

On the one hand, there was the deteriorating economy, which is why fewer games were sold in the Christmas business than hoped.

Recent releases like the action game Mario + Rabbids Sparks of Hope fell short of expectations.

The dance game "Just Dance 2023" did not ignite either.

"We are very disappointed"

The company, which was founded in 1986, considers the fact that customer interest is increasingly shifting towards long-lived titles and "mega brands" to be an additional complication.

Ubisoft says it has been responding to this trend by investing in live games for four years, but admits that the fruits have not yet been reaped.

However, this is partly your own fault.

There are again delays in the development of the eagerly awaited action game "Skull and Bones", which will probably not be released until 2024 - seven years later than originally announced.

The gloomy prospects are not without consequences.

Ubisoft announced that it would scrap three more games in the development phase, which now makes seven in half a year.

This is accompanied by a write-down of 500 million euros on research and development expenses.

In addition, the company wants to save 200 million euros over the next two years, including through restructuring and the sale of non-core activities.

"We are very disappointed with our recent performance," said Yves Guillemot, co-founder and CEO of Ubisoft.