Ubisoft in Breach and Revenue Recognition Issue Raises Caution

2 months ago

Louise Moon

"Um, they delayed their third quarter results last week without explanation, and released them this morning, so a week later than expected. And within that, they said they've been in breach of a loan agreement. So essentially auditors found that Ubisoft had improperly booked sales from a partnership and so postponed recognizing revenue from that partnership um within results. So they forced it to restate their 2025 financial accounts and those changes put it in breach of the loan agreement as I said. So they say that they will address those uh that issue by early repayment of loans. Um and as you say so shares initially fell on the news obviously not not great news but then rebounded. It kind of caps a week of speculation. people didn't know what was going on and essentially a bit of a relief uh potentially not as bad as expected."

The commentary on Ubisoft highlights significant issues including a delayed Q3 report, a breach of its loan agreement due to revenue recognition errors, and a forced restatement of its 2025 accounts. Despite an initial sell-off, shares rebounded, suggesting that the market may view the situation as not as severe as initially feared.

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