Ubisoft CEO Yves Guillemot has attempted to explain the company’s recent push for a further €200 million ($235 million) in cost reductions, which has led to mass layoffs and a spate of game cancellations recently.
Speaking to Variety, Guillemot said the video game industry overall “grew very quickly” coming out of COVID, with people anticipating that the momentum for gaming generated during the pandemic would be sustained. However, this did not “fully materialize,” Guillemot said.
For Ubisoft specifically, Guillemot said this anticipation for future returns “led to too many projects and increased complexity,” and now Ubisoft is making major cuts. The latest of the layoffs hit Ubisoft Toronto, but the team’s Splinter Cell remake remains in development.
“Our priority today is to build a more focused, agile company, with stronger teams that strike the right balance between senior expertise and young talent and who are well positioned to deliver the highest quality games,” he said.
The executive went on to say that Ubisoft is trying to navigate the cost-reductions “as thoughtfully and responsibly as possible.”
Beyond layoffs, Ubisoft is “reducing certain expenses, adjusting or stopping projects where necessary, improving production processes, and making more effective use of our tools,” Guillemot said.
The upheaval at Ubisoft has prompted developers to go on strike, with a labor union calling for Guillemot to resign.
In January, Ubisoft announced that it had canceled six games and delayed seven, while closing two Ubisoft studios and conducting rounds of layoffs across the company. This was part of a wider strategic reset and reorganization of the company around five different “creative houses.” What’s more, Ubisoft made a billion-dollar deal with Tencent to position itself for the future.
The Prince of Persia remake was among those games that got canceled, and one of the delayed games is rumored to be the heavily leaked Assassin’s Creed IV: Black Flag remake.
In the same interview, Guillemot said two new Far Cry games are coming, along with more Assassin’s Creed games. Additionally, he said Ubisoft is developing multiple new IPs.