Pixel P&L: Nazara Posts Record EBITDA But Profits Plummet

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Nazara’s Q3-FY25 report reveals a surge in EBITDA offset by shrinking profits as rising expenses weigh on the bottom line. Meanwhile, Ubisoft grapples with declining revenue, and a new Ramayana-themed game enters the market. We detail all this and more in today's Pixel P&L.

/ Nazara Reports Record $6.3M EBITDA in Q3, But Profit Declines Amid Rising Costs

Nazara Technologies posted its highest-ever quarterly EBITDA of ₹52.4 crore ($6.3 million) in Q3 FY25, marking a 39% year-on-year growth. Revenue surged 67% to ₹534.7 crore ($61.5 million), fueled by acquisitions like Fusebox Games and strong performances from titles such as Animal Jam.

Despite the top-line expansion, the Mumbai-based gaming and esports company saw its profits drop 53.6% to ₹13.7 crore ($1.7 million), as total expenses climbed 76% to ₹531 crore ($61.1 million). Marketing costs soared 3.5x to ₹145 crore ($16.7 million), while employee benefits and content costs also weighed on margins.

Esports remained Nazara’s largest revenue driver, contributing 43.5% (₹232.6 crore/$26.8 million), followed by gaming at 29% (₹155 crore/$17.9 million). Ad tech, a smaller segment, added ₹10.5 crore ($1.2 million). The company also earned ₹22 crore ($2.5 million) from financial assets, pushing overall revenue to ₹556.6 crore ($64 million).

Ubisoft Reports Declining Revenue, Bets on Assassin’s Creed Shadows for Rebound

Ubisoft reported a sharp decline in revenue and net bookings for the nine months ending Dec. 31, 2024, but remains optimistic about its upcoming slate, particularly Assassin’s Creed Shadows. The company posted €990 million in revenue, down 31.4% year-over-year, while net bookings fell 34.8% to €944 million.

Despite a 51.8% drop in Q3 net bookings, Ubisoft met revised expectations and is banking on Assassin’s Creed Shadows, set to launch March 20. CFO Frederick Duguet said pre-sales are tracking in line with Assassin’s Creed Odyssey, the franchise’s second-highest earner. CEO Yves Guillemot highlighted positive early previews and a “dual protagonist approach” in Shadows.

Ubisoft continues cost-cutting efforts, exceeding its reduction plan after recent studio closures and layoffs. The company is also reviewing strategic options, including potential partnerships or acquisitions, amid speculation of a Tencent buyout.

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⚡ Quick Bytes

88 Games Announces ‘Kapih,’ a Ramayana-Inspired Action Platformer

The game is also inspired by traditional Indian art forms like Kalamkari and Madhubani. It will feature run-and-gun gameplay, shoot-em-up sections, local co-op, and even Sanskrit voiceovers. Set for release on PC, PlayStation, and Xbox, Kapih debuted its trailer on Sony PlayStation’s channels, marking a push to bring Indian storytelling to a global gaming audience.

Activision Blizzard Workers Condemn Kotick’s Comments on Harassment Lawsuits

The Communications Workers of America (CWA) criticized former Activision Blizzard CEO Bobby Kotick for calling workplace harassment lawsuits against the company “fake” during a Grit podcast interview. The union called his remarks “false” and “insulting” to victims, citing Activision Blizzard’s $18 million EEOC settlement in 2021 and a $54 million settlement with California regulators in 2023. The ABK Workers Alliance also condemned Kotick’s claims, stating their unions formed in response to workplace misconduct, not as a scheme to drive membership.

Esports World Cup Partners With Tencent to Expand in China

Announced by CEO Ralf Reichert, the partnership aims to “strengthen the reach of the Esports World Cup in China”. Tencent will help develop a dedicated team to integrate Chinese esports into the EWC’s global ecosystem, reinforcing the tournament’s international footprint.

💡 Did You Know?

Did you know that virtual reality is breathing new life into Taekwondo? Advanced VR and motion capture technologies are transforming the traditional martial art into an innovative, contact-free esport known as Virtual Taekwondo (VTKD). Using systems like Refract Technologies’ AXIS, VTKD minimizes injury risk while broadening participation across age and skill levels. With the International Olympic Committee showing interest in virtual sports, VTKD could soon feature in Olympic esports events. This digital evolution is not set to replace traditional Taekwondo but rather expand its reach and rejuvenate the sport for a new, tech-savvy generation.

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