Ubisoft recently made the shocking announcement that it would shut down its Call of Duty competitor, XDefiant, close Ubisoft San Francisco, and lay off nearly 300 people in what was just the latest unfortunate development for the people who make video games in this business. Now, internal memos from CEO Yves Guillemot and chief studios boss Marie-Sophie de Waubert have emerged.
Guillemot said in a memo obtained by Insider Gaming that the decision to cancel XDefiant, close Ubisoft San Francisco and Osaka, and ramp down its Sydney office was “among the most difficult decisions we’ve had to make.” Guillemot praised the XDefiant development team and its ambition to “challenge the best shooter on the market.” However, “it was not enough,” he admitted.
For those being laid off, Guillemot said he expresses his “deepest gratitude” and that the company will do “everything possible” to help affected staffers.
Guillemot went on to say Ubisoft is indeed going through “turbulent times,” adding that he is working with his executive team to find the “best solutions so we can maintain control of our destiny.” When Ubisoft’s stock price began to tank earlier this year, some theorized the lower company value might make the company an acquisition target.
In October, a report claimed Ubisoft was talking to Tencent about all manner of options, including turning Ubisoft private or having Tencent acquire the company. Nothing has materialized from this as of yet, but Guillemot’s wording about being able to “maintain control of our destiny” suggests something may be afoot, or perhaps it doesn’t mean that at all.
“I’m doing everything I can to help us regain momentum, so that we can continue to make Ubisoft a key player in our industry, a creator known for its unique and exceptional video games,” Guillemot said in his memo to staff.
As for the memo to staff sent by Marie-Sophie de Waubert, it was published on Ubisoft’s own public website and shed some additional light on what happened with XDefiant. She said the game had an “encouraging start” but failed to “attract and retain” enough players.
“The game is too far away from reaching the results required to enable further significant investment, and we are announcing that we will be sunsetting it,” she said.
The executive went on to say that Ubisoft’s lack of success with XDefiant doesn’t mean the company will stop pursuing games-as-a-service titles. In fact, she said games-as-a-service remains “a pillar of of strategy,” citing examples of success like Rainbow Six, The Crew, and For Honor.
“It’s a highly competitive market, and we will apply the lessons learned with XDefiant to our future live titles,” she said.
XDefiant was developed by Ubisoft San Francisco, and about half of the developers are shifting to other projects within Ubisoft as a result of the game’s shutdown. The game was produced by Call of Duty veteran Mark Rubin and launched in May, attracting lots of players right out of the gate. The momentum could not be sustained, however. On October 15, Rubin responded to claims that XDefiant would shut down after Season 4, saying there were no plans to do that and in fact, he was already planning content for the game’s second year.
De Waubert also teased larger, structural changes coming to Ubisoft in the future in the areas of production and business practices. Guillemot, for his part, said in his memo that Ubisoft will try to have “fewer unnecessary processes” so its workers can focus more on making games.
These latest layoffs at Ubisoft come after a previously announced cost-cutting program that already resulted in more than 1,000 layoffs at the company.