24/07/2025

BIZ & FINANCE THURSDAY | JULY 24, 2025

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Ubisoft aims to be more agile and focused

Nokia lowers forecast on weaker dollar, US tariffs HELSINKI: Telecoms equipment maker Nokia on Tuesday said it is lowering its profit forecast due to the weaker dollar and US tariffs, as it reported second-quarter results. The profit outlook for the full year is now between €1.6 billion and €2.1 billion (RM8 billion to RM10 billion), €300 million less than previously indicated, it said. Currency fluctuations – “particularly the weaker US dollar” – and “the current tariff landscape” led to the revision, the Finnish company said in a statement to investors. A weaker dollar is weighing on European companies with operations in North America, reducing turnover in euro terms and making euro-denominated exports to that market more expensive. US President Donald Trump’s 10% baseline tariff announced in April – followed by threats to increase the tariffs on EU products to 30% after Aug 1 – are weighing on other big European firms. The United States has also imposed a 30% tariff on goods imported from China, while China imposes a 10% levy on goods brought in from America. Nokia operates in both the US and Chinese markets. Nokia said current tariffs were “expected to impact full year operating profit by €50 million to €80 million”. Nokia said its guidance is now based on a euro exchange rate of US$1.17, compared with just above parity at the start of the year. The company said preliminary sales in the second-quarter were €4.6 billion, with a €300 million operating profit. Revenue was lower than the €4.8 billion analysts consulted by Factset had been expecting. – AFP Amazon shuts down Shanghai AI lab: FT SHANGHAI: Amazon is shutting down its Shanghai artificial intelligence lab, the Financial Times reported yesterday. Amazon’s decision to shut the lab comes amidst rising tensions between Washington and Beijing, with the US increasing its scrutiny of American companies operating in China. Wang Minjie, a scientist in the Shanghai lab, said his team was “being dissolved due to strategic adjustments amid US-China tensions”, the newspaper said, citing a post on WeChat. Amazon Web Services (AWS) set up its Shanghai Lab in 2018. While the headcount at the AWS Shanghai research lab is unclear, the FT report said, AWS at its peak had more than 1,000 staff in China. The report comes as the tech giant slashes jobs globally, joining a growing list of firms, including Microsoft and Meta, who have announced layoffs this year as they increase their reliance on artificial intelligence. – Reuters sweeping tariffs since returning to the White House – drawing ire from the president. Trump has repeatedly cited mild inflation numbers as a reason the Fed should lower rates, arguing that the country would also pay less interest on debt coming due. Trump said kn Tuesday that interest rates should be three percentage points lower. But lower rates, while a boost to the economy, can also increase consumer prices. Trump and other Republican allies have recently zoomed in on the Fed’s headquarters renovation project as a potential avenue for Powell’s ousting. – AFP

price, Ubisoft created the first such subsidiary earlier this year in €1 billion deal with heavyweight Chinese investor Tencent. The 3,000-strong unit will control Ubisoft’s biggest franchises in Assassin’s Creed , Rainbow Six and Far Cry . Ubisoft said last week that the subsidiary will be run by the CEO’s son Charlie Guillemot alongside Christophe Derennes, a veteran chief of the company’s major development studio in Montreal. “Christophe, Charlie and their teams will benefit from advice and expertise from Tencent,” one of China’s largest gaming and internet firms, the CEO said in his e-mail to staff. Looking ahead, Ubisoft plans to release in March a remake of Prince of Persia: The Sands of Time , one of its most popular titles from two decades ago. Strategy series Anno will get a new episode set in ancient Rome while the company is also cooking up mobile versions of Rainbow Six and fellow shooter The Division . It warned in May however that several unannounced major titles were being delayed. Such news has contributed to a 28% slump in Ubisoft’s stock price since January. Ubisoft’s image has also been harmed by a high-profile case in which three former executives were sentenced this month for enabling a culture of sexual and psychological harassment. – AFP

which excludes some deferred revenues. The company forecast net bookings of around €450 million in its second financial quarter, boosted by new partnerships and revenue from TV series. For the full financial year, it confirmed objectives including stable year-on-year net bookings and “approximately break-even” operating profit. Ubisoft made a net loss of €159 million in 2024-25 and is in the midst of a cost-cutting plan that has seen it shut several studios outside France and slash over 2,000 jobs. Its woes reflect broader, global headwinds for the video games industry over the past two years. Guillemot – a member of the founding family that has run Ubisoft for decades – also said the company had made “meaningful progress” on the plan to split its activities among several “creative houses”, each responsible for a different slate of games. Ubisoft has not gone into detail about the functioning of the new units or how its remaining franchises will be divided among them, promising further information about the reorganisation by October. In an e-mail to staff last week seen by AFP, Guillemot had said the units would be “autonomous” and “completely responsible for their business objectives”. Pressured to change by a string of disappointing releases and a slumping stock

PARIS: Struggling French video games giant Ubisoft shed light on a far-reaching reorganisation of its business on Tuesday, as it reported disappointing sales in April-June. The internal rejig into a slew of autonomous units aims for “a more agile and focused organisation while ensuring necessary long-term stability and creative vision”, chief executive Yves Guillemot said in a statement. Ubisoft reported €311 million (RM1.5 billion) of sales in the first quarter of its 2025-26 financial year, a fall of 3.9% compared with the same period last year, largely driven by technical problems with shooter game Rainbow Six Siege . Acknowledging “mixed results”, Guillemot nevertheless hailed the release of Assassin’s Creed Shadows . The latest instalment in the money-spinning franchise “delivered on its expectations, with now more than five million unique players since launch”, he said in a statement. Sales were slightly less impacted, losing 2.9%, when measured using Ubisoft’s own preferred indicator of “net bookings”, o Video games giant making progress on plan to split into several ‘creative houses’

Renovations at the Marriner S. Eccles Federal Reserve Board Building in Washington. – AFPPIC

Bessent says no reason for Fed chairman to step down WASHINGTON: US Treasury Secretary Scott Bessent said on Tuesday that he did not see a reason for Federal Reserve chairman Jerome Powell to resign immediately, a day after calling for a sweeping review of the Fed. done a bad job, but he’s going to be out pretty soon anyway.” Bessent added in his television interview, referring to Powell: “There’s nothing that tells me that he should step down right now.” Bessent, in his post on X, said the Fed’s “independence is a cornerstone of continued US economic growth and stability.”

“However, this autonomy is threatened by persistent mandate creep into areas beyond its core mission,” he added, without specifying which policy areas. On Tuesday, Fed vice-chairman for supervision Michelle Bowman maintained in a CNBC interview that the central bank’s independence in setting monetary policy is “very important”. The Fed has held interest rates steady this year as it monitors the effects of Trump’s

He noted that Powell’s term as Fed chair ends in May 2026, and that Powell should see out his full term if he wants to. But if the Fed chief wanted to leave early, he should as well, Bessent added. In a social media post on Monday, Bessent called for the Fed to conduct an “exhaustive internal review of its non-monetary policy operations”, accusing the central bank of mission creep.

Bessent’s comments to Fox Business come as Powell faces growing pressure from Donald Trump’s administration to slash interest rates, with the president recently ramping up attacks against the independent central bank chief over the Fed’s US$2.5 billion renovation project. But Trump has said it was highly unlikely he would oust Powell before his tenure is up next year, and on Tuesday told reporters: “I think he’s