Ubisoft Exceeds Third Quarter Expectations At $396 Mil

Major video game publisher Ubisoft has announced the sales for its third quarter ending December 31st, reporting target-exceeding sales up 24 percent to €311 million ($396 mil). The third quarter sales were up from the prior year's €250 million ($318 mil) and outpaced Ubisoft's projections of €280 million ($357 mil), totaling €483 million ($615 mil) for the first 9 months of the fiscal year, up 20 percent, or 22 percent, Ubisoft notes, at constant exchange rates. Ubisoft notes that the third quarter sales were primarily fueled by a select number of its key franchises. €16 million ($20.38 mil) of that was driven by third quarter titles alone, primarily Tom Clancy’s Rainbow Six Vegas, but also Tom Clancy’s Splinter Cell Double Agent and the Wii's Red Steel. An additional €6 million ($7.64 mil) came from fiscal first half titles, including Pirates of the Caribbean 2, Dogz, Kingdom Hearts, and OverG Fighters, and €7 million ($8.91 mil) was driven by back-catalog titles. Ubisoft also points out that 63 percent of software sales from the third quarter came from next-gen console titles, up over the 18 percent from the prior year. Wii sales accounted for 21 percent of those sales, and pushed Ubisoft into the position of the number one third party publisher for the Wii in Europe and the U.S., with market shares of 29.2 percent and 18 percent respectively. Sales of Xbox 360 titles accounted for 28 percent of sales, up from the prior year's 5 percent, and similarly made Ubisoft the number 2 third party publisher for the Xbox 360 in both Europe and the U.S., with market shares of 14.6 percent and 13.4 percent respectively. Finally, the Nintendo DS made up 9 percent of sales, up from 5 percent in the third quarter of 2005-06. Ubisoft also says that the launching of three new original properties, Red Steel for the Wii, and Dark Messiah Might and Magic and Heroes of Might and Magic for the PC, have together sold nearly 2 million units combined. For the fourth fiscal quarter, Ubisoft plans to bring Tom Clancy's Ghost Recon Advanced Warfighter 2 to the Xbox 360, PSP, and PC, hoping to follow the success of its original title, which sold nearly 3 million units. It also looks to bring similar success to its new game in the Teenage Mutant Ninja Turtles franchise to accompany the new film version, Tom Clancy’s Splinter Cell Double Agent and Tom Clancy’s Rainbow Six Vegas ports for the PlayStation 3, and four new games for the Wii. Based on these titles, Ubisoft is projecting €152 million ($193.58 mil) in fourth-quarter sales, up from the prior year's €144 million ($183.39 mil). Its original next-gen first person shooter Haze, from Timesplitters developer Free Radical has been postponed until the fourth quarter, as well as three additional Wii titles, which Ubisoft projects will bolster fiscal 2007 sales. For fiscal 2007-08, Ubisoft is maintaining its current growth target of 25 percent, to sales of between €750 million ($955.16 mil) and €766 million ($975.53 mil). Said Ubisoft CEO Yves Guillemot, "The very positive trend identified in October and November continued into December. We saw excellent sales for Tom Clancy’s Rainbow Six Vegas – which ranked as the third best-seller in December for the Xbox 360 system in the United States – as well as sustained success for Red Steel and Rayman, which have ranked number two and three in sales for the Wii in the United States and Europe since the console was launched." He added, "2007 will be the year of new-generation consoles, with the ramp-up of the PlayStation 3 and Xbox 360 systems. We will also see new consumers – particularly women – entering the market, drawn by the remarkable success of the Wii and the Nintendo DS. In 2007-08, Ubisoft will apply all of its expertise in order to leverage this full scope of opportunities, and thereby step up growth and considerably improve profitability."