Q2 19/20

Oct 30, 2019

Good afternoon and good morning, everybody. Thank you for joining our conference call. As announced last week, we are implementing new changes to our organization. While they are having a negative impact on our short term performance, we expect they would generate sufficient value over the coming years. Ubisoft has a history of making moves intended to spur its long term prospects that have led to very significant value creation for its shareholders over the past 5 years. 10 years ago, we focused our strategy on our biggest franchises, and we put in place the lead and associate studio organization. 6 years ago, we decided to increase the production time between the alpha and the release date for our games. Those two decisions and others like them have led to a material transformation of our portfolio, with the launch of successful new ITs like The Division, Watch Dogs and For Honor, with significant growth for franchises like Rainbow Six and Far Cry and a strong comeback for Assassin's Creed franchise. And we delivered a huge increase in players' engagement over the past few years. Our numbers of session dates for the 1st 6 months of this year is equal to the total number of session dates for the full fiscal year 2014, 2015 2016 combined. These are all significant achievements and led to 100,000,000 unique active players on PC and console last year. Looking at H1. After a better than expected Q1, our 2nd quarter net bookings came in above our target, demonstrating the strength of our back catalog. Our second quarter was only down 7% at constant exchange rates despite no AAA release this H1 versus DUCRE2 released in June 2018. This speaks to the broad performance of our portfolio of franchises and notably the great momentum of Rainbow 6 Siege and Assassin's Creed Odyssey. Before turning the call over to Frederic, I would like to come back to the comment we made last week regarding the Division 2's momentum versus our initial expectation. In absolute value, I want to underline that the Division 2 is delivering an overall solid performance. It was the biggest seller of the industry for the 1st 6 months of the calendar year and it generated a solid financial contribution. As such, we are going to support the game with high quality updates for the community as we are doing for our biggest titles. I will now let Frederic detail our H1 performance. Frederic? Thank you, Yves, and hello, everybody. Net bookings in H1 reached €661,000,000 down 13% at constant exchange rates. Our Q2 net bookings reached €347,000,000 down 7% at constant exchange rates and 12% above our target of approximately €310,000,000 As a reminder, the year on year decrease mostly reflects fewer early physical shipments for Ghost Recon Breakpoint versus Assassin's Creed Odyssey last year. Excluding that technical impact, Q2 is slightly growing versus last year. We delivered this better than anticipated quarter, thanks to a solid and across the board back catalog performance, up 3% to €238,000,000 This was spurred by a solid increase in overall play time and by a growing engagement per player, while MAUs were flat year on year. This more than offset the high comparison base from Far Cry 5 outstanding contribution in Q2 last year. Mobile and PC also contributed to this over performance. As we celebrate its 1 year anniversary, we can confirm the continued momentum of Assassin's Creed Odyssey. Daily engagement, PRI and sales grew continued to grow strongly over the quarter, ahead of Assassin's Creed origins last year. All of these metrics even accelerated during the quarter after an already very strong Q1. Rainbow Six Siege MAUs has reached a new record this quarter. As a consequence, PRI grew again year on year. The game passed the 50,000,000 registered players mark in September, and its solid momentum over the quarter was spurred by the July event slowdown and the new season operation Amber Rise in September. On the Esports scene, the 6 major rally organized in August saw a meaningful engagement progression with a 27% increase in watch time compared to the 6 major parties 2018 addition. Finally, the current Halloween event is seeing the strongest revenue per session ratio since the outbreak expansion in March 2018 and a robust year on year engagement progression. We recently introduced the Mini Battle Pass, and we'll launch the full version during an upcoming season. Concerning The Division 2. In October, we released Episode 2, The Last Castle. With the 2nd major update, we brought extensive changes and delivered a host of improvements fueled by community feedback. Ipizza 2 generated the highest reactivation rate since the launch of the Division 2. The improvement to accessibility and the overall health of the game resulted in the most successful conversion rate for a free weekend on The Division 2. And as the game was the biggest seller of the calendar year until the end of June. We are already hard at work improving the cost recall breakpoint experience for our community of players. Our first priority is to improve the technical state of the game with the release of several title updates in the coming weeks. In parallel, we are also working to make the experience for players more comfortable. We are dedicated to supporting the game in the long term to keep the world constantly growing and evolving. Among our other titles, Brawlhalla, our free to play game, now supports cross platform play between PS4, Xbox 1, PC and Switch. The game continues to enjoy great momentum with very strong year on year growth. In H1, total digital net bookings reached €537,000,000 up 4%, and PROI was up 18% to €310,000,000 On a platform basis, EC, up 18% in H1, continues to enjoy a strong momentum. As a reminder, we launched our Uplay platform 10 years ago, and this long term investment is now paying off, ultimately. Following a great performance in fiscal 2019, revenues on Uplay grew very strongly again in H1. Additionally, we launched our new subscription platform Uplay Plus on PC in September, which aims at leveraging our diversified portfolio of own IPs. Like with other subscription services, the early data is showing that subscribers are more engaged than non subscribers. This is just the beginning and as you know, we did not factor any contribution from New Play Plus in our assumptions for the fiscal year. Looking at our mobile business, Net bookings were up 6% in H1 and 33% in Q2. Q2 growth is due to the releases of Mighty Quest for Epic Loot and Raymond Mini and to the acquisition of Green Panda Games. The quarter saw strong performance from the hyper casual segment with 4 of our games in the top 10 iOS download rankings in the U. S. This summer. Regarding earnings, we implemented for the first time IFRS 16 in H1. The objective of IFRS 16 is to marginalize the accounting presentation between companies buying and just leasing their assets and to standardize the accounting treatment of all types of lease. At the balance sheet level, this implies, first, the accounting of right of use of the assets amortized over the duration of the contract for a net amount of €206,000,000 second, the accounting of the lease obligation or liability corresponding to the sum of discounted future cash flows for €217,000,000 At the P and L level, impacts are as follows and are marginal this semester: cancellation of the rental expense and recognition of an amortization expense of the right of use, recognition of interest expenses on financial debt, the accounting of tax if applicable. Finally, IFRS 16 has a meaningful impact of €217,000,000 on the net cash position. Therefore, we have introduced a new metric, which is a non IFRS net cash position adjusted from IFRS 16 impacts in line with our historic net cash calculation. Let me now go into the details of our H1 earnings, which mostly reflect the momentum of our back catalog, compensated by the unfavorable comparisons of Gauche recalled breakpoint versus Assasin Secular DC and the Division 2 versus Far Cry 5, the release of the CRU II last year and one off elements. As you can see in Slide 5 of our presentation, our gross margin stood at 85.4%, a 0.3. Increase versus last year. The positive mechanical impact from the digital progression was primarily offset by one off elements related to higher hosting costs. R and D was up 6.6 points and I will review it in the following slide. Regarding SG and A, marketing was impacted by a bigger campaign for Gulf Freight Point versus Assassin's Creed Odyssey. Our fixed structure costs were up 5.1 points with the biggest increase factor being the last December acquisition of i3d.net followed by our investment in our e commerce platform data and security. Turning now to Slide 6. Despite no AAA release in the quarter, R and D P and L was up 5% due to the significant impairment charges we recorded on breakpoint. Our total cash R and D was up 12%, reflecting our stated goal to fuel our long term growth and value creation. More specifically, the 24% increase in non capitalized R and D reflects our investment in post launch content to drive strong PRR growth for H1 and for the coming year. It also reflects a onetime accounting event as last year, Embassy Siege post launch was capitalized and it is now fully expensed. Regarding the reconciliation table, Slide 7. IFRS sales are impacted by a positive €36,000,000 that was deferred from the prior year. Stock based compensation was slightly down versus last year. And as usual, our non IFRS figures also exclude a €4,000,000 non cash charge related to convertible bond option costs. Looking at our cash flow statement in Slide 8. There are different elements to highlight. First, the €193,000,000 decrease in cash flow from operation is mostly due to the non IFRS net income decrease of €146,000,000 combined with the €33,000,000 increase in the gap between R and D, P and L and cash. This is partially offset by an €84,000,000 decrease in working capital requirement that is mostly related to fewer early physical shipments on Breakpoint versus Odyssey last year and inventory variance from prior year related to the launch of StarLink. We had €33,000,000 in acquisition related to the acquisition of Grid Panda Game end of July and deferred payment of past acquisitions. Finally, we had €77,000,000 proceeds from issue of capital and €35,000,000 disposal of our own shares to fund our latest employee share plan, which had a positive impact of €112,000,000 All in all, this translated into a non IFRS net debt of €218,000,000 that compares with €337,000,000 a year ago. Talking about net debt. I would like to highlight we benefit from a solid financial position. As you can see in Slide 9, even if we factor in the fact we expect negative cash flow from operations over the 2nd semester, we expect a significant improvement in our net financial situation by year end. Additionally, with €1,300,000,000 in committed available funding and no maturity debt within the next 3 years, excluding €50,000,000 in Fuschheim, combined with a total equity of comfortably north of €1,000,000,000 by fiscal year end, we benefit from a very strong financial situation that will allow us to finance further growth development, contemplate potential M and A and opportunistic buybacks. Looking at Q3, we expect net booking at around €410,000,000 down 32% versus last year. This mostly reflects the lower cost record breakpoint relative to Assassin's Creed or DC as well as to a lesser extent the launch of StarLink last year. As for the full year 2020, as we announced last week, we now target net bookings of approximately 1.4 €50,000,000 and we expect non IFRS operating income to end up between €20,000,000 €50,000,000 In line of these new targets, we are now expecting digital, PRI and back catalog to grow meaningfully as a percentage of net bookings versus last year. Regarding the items below the non IFRS operating income line, please note that the number of diluted shares is now expected around 122,000,000. Last week, we also introduced our first targets for fiscal 2021 with net bookings and non IFRS operating income of approximately €2,600,000,000 and €600,000,000 respectively. With the additional time provided to our 3 titles and the fact that other 2 AAAs come from our biggest franchises, we believe we have a strong visibility on next year's lineup, and we also plan to continue to PRI, Asia and PC. For the years beyond fiscal 2021, we continue to expect releasing 3 to 4 AAA's per year to benefit from a growing catalog and PRI and from our Tencent partnerships on mobile and on the ongoing momentum in Asia and PC. I now hand over the call back to Yves. Thank you, Frederic. We are confident in the medium and long term prospect for Ubisoft. The ongoing trend of popular IPs successfully transitioning to mobile like Fortnite and Call of Duty proves our strategy of bringing our franchises on mobile is the right one. It can generate significant value. The new generation of consoles will bring heightened excitement from gamers and our PC momentum will continue to bear fruit. Asia is also a significant source of opportunity for Ubisoft And we will leverage our strong and diversified portfolio of IPs through the multiplication of platforms and new play. Finally, while the decision we made last week is impacting our short term performance, history shows that those kinds of moves are always very positive to our long term development. We expect financial year 2021 and financial year 2022 to demonstrate the first benefit of that decision. We're now ready to answer your questions. Thank And we will now take our first question from Nicholas Langlett of Exane BNP. Please go ahead. Your line is open. Hello. Good afternoon, everyone. I've got 3 questions, please. The first one on REMBOSSIX. So you mentioned a good PRI growth in Q2. Now the competition is likely to become a bit tougher in the coming months notably with Call of Duty Modern Warfare. Do you think your own initiative can offset that increased competition and allow Rainbow Six continue growing in H2? Is it what you included in your guidance? 2nd question on the full year 2021 net booking. You didn't comment on the split between back catalog and new game last week. Hopefully, you can give us a bit more color, at least a rough split between the 2? And third question, on your on the non IFRS net debt. If we take into account the recent issuance of the new convertible bond and your expected free cash flow, what rough level of non IFRS net cash position you expect for the full year? Thanks. So on the first point, Nicolas, we had indeed a very strong Q2 on Rainbow on the PRI side. As we said, we reached a record MAU number over the quarter. It was even bigger than during the quarter when we launched the Artbreak expansion. We see that engagement grew at the double digit growth rate in Q2. So as a consequence, PRI grew nicely. And what we've seen recently is that with the Halloween event, it grew materially again engagement and PRI, while it was in front of strong competition. So that confirms that we are coming with a higher number and of higher quality of events and we come with the high pace of content delivery. It's doing very well for Rainbow. We're also happy to come with the battle pass that would be a strong retention tool in the future. So we believe rainbow is coming well in terms of PRI growth. And yes, we assume that PRI will grow in the 2nd semester. In fiscal for fiscal 2021, it's too early to provide any detail on this metric. What we said is that we have very strong visibility on our new releases that we reviewed thoroughly and we believe that they will be coming along very well. And so that's the reason why we believe that fiscal 1 will be a great year. On your question, yes, taking into account that we'll have the impact of the new convertible bond and the conversion of the previous one. And assuming that we have negative cash flow from operation in the 2nd semester, we expect that our net cash position will strongly improve versus our net position at end of September in non IFRS terms. You're welcome. We will now move on to our next question from Mike Ng of Goldman Sachs. Please go ahead. Your line is open. Great. Thank you so much for the question. Maybe I just have 2. The first is, could you just talk a little bit about the PRI strength in Rainbow Six Siege? How should we think about the cadence of that PRI in the second half? And are there any specific events or live services update that you would highlight? And then as a follow-up to that, do you think the success of Rainbow Six Siege has made it more difficult for other Tom Clancy games like The Division or Breakpoint to succeed? And just as a housekeeping question, could you just tell us how much the impairment charge was for Breakpoint? Thanks. So first on the competition Reign versus 6 could have on the other products. We don't think that it has a major impact as it is a PVP game where the other games are more solo and co op? Frederic, maybe you can answer the other question. Yes. So on the PRS trends on Rebusixeige, I think I already answered the question previously. Again, we've been happy to see that we are increasing with a stronger cadence in terms of content delivery. And what we see is that the fact that we're coming more often drives more sessions per player per month and that's the key point. And we also believe that our PRI improvement potential is strong on Rainbow. The fact that we are coming with Battle Pass will be very positive for the future. In terms of impairment charges for Jean Francois Bracquaint, it's meaningful, but we don't give the exact amount on this. And you have to consider as well that asserting straight odyssey PRI is also very good. Yes, we've been very happy with the term again in Q2. Great. Thank you very much. Thank you. We will now take our next question from Robert Berg of Berenberg. Please go ahead. Your line is open. Yes. Thanks, guys. A couple of questions left for me. The first, I'm slightly confused by the message on the Division 2. Last week, you pointed to it being a disappointment and a reason behind the downgrade this year. Today, you're saying it's setting reactivation records, and you're keen to say how well it's doing. I just want you to try and summarize everything together and what is the message we should be taking away for this game. And the second question on the convertible, again, I'm keen to hear why you decided to issue another convertible. Did you consider other sources of finance? And why did you come to the conclusion that the convertible was the most appealing? So on Division 2, what we wanted to say is that even if we were disappointed by the expectations we had on the game, we see it was still a good seller and it was profit meaningfully profitable. So it's just it didn't do what we expected, but it's still a very good gain. That's what we wanted to say. Yes. Robert, on the convertible, yes, we carefully examined different alternatives, especially the alternative between convertible bond and non rated bonds possibility. What was very clear after our in-depth analysis was that the market conditions were exceptional in the convertible bond side with a very strong imbalance between offer and demand. And that led us to the conclusion in a very clear manner that we will benefit from exceptional market conditions with no risk of execution and actually with a high probability of very high quality in the execution. So that's exactly what happens. We're able to optimize the terms to exceptional levels, up to 65% premiums and negative 1% yield over 5 years. So that's been pretty exceptional in terms of market terms. So that's why we wanted to see this opportunity to provide a company with the right long term flexibility to fuel our growth in terms of development internally, but also with a focus potentially if M and A opportunities arise. Thanks. Just a very quick follow-up. Do we assume that everybody in the previous convertible converted? Is that the base of what we should be assuming? Yes, the 99.4% converted on the previous one. You're welcome. We will now take our next question from Ken Rump of Jefferies. Please go ahead. Your line is now open. Could I ask something about your thought process in delaying the games and what differently you would do going forward. Firstly, in terms of the thought process, you had a choice, I guess, of delaying kind of 1, 2, 3 games. It seems to me you could well have decided that you'll say Gods and Monsters is very different. It's nothing to do with Ghost Recon. We could go ahead with this. And it seems to me perhaps you saw this year is financially kind of severely impacted. Let's push everything. So a little bit about your thought process about of why all three, why not, just a couple. Related to that, what kind of inefficiency cost do you bear this year? You effectively, you have a staff and a marketing department that's designed for 3 or 4 games. Those guys are all still working. Okay. You don't have to buy as much media capacity as you would have done for if you had those launches, but there are fixed costs that are kind of underutilized that would have been utilized if you'd launched a game as planned in the Q1. How much, if you like, does that weigh on the second half of the year? And finally, regarding the extra time that you're giving yourself, part of the problem appears to be that although you scrutinized Gocerecoin and tested it and surveyed it in advance and it seemed like it would be okay, it didn't turn out that way. So what different do you do going forwards with the 3 games? Do we have an earlier beta? So you tell me what can you do aside from spending more time and polishing harder to kind of ensure those games have what players demand and avoid the mistakes or the disappointments of Ghost Recon? Thank you. Can? So thank you for your questions. What you have to consider for the team that we marketing team that we have is that as we are doing lots of events on our live games, they will have plenty of work to do on all those events. For sure, not having games will cost, but it means we will spend a lot more time on all those events and live events that we will have on our games. Now on the other question about how do we do it differently than on God's Dragon on the next releases. Having more time is going to give us a chance to do more testing, get more feedbacks from players. And this is what we the way we have been doing in the past. So more time is going to help us to have a better understanding of all the changes we can make. So as those games are going to be playable for a long time, we are going to get those info and make the modifications that are that can be needed. So if I understand in a way, if you had a beta and then several months to respond to it, there's more you can do? In fact, we are also changing our organization to check all the problems that we had last time with Gauss Recon. So we this organization is also going to check all the different points that we want to check. What is important Ken, what is important to consider is that, like we said last week, we have we're working on 2 major elements. First of all, making sure that each breakthrough new formula, change in formula, new brand are coming with a very highly optimized experience and that's our key goal that we're stating very clearly, loud and clear. And that's why we believe that these 3 games that are coming with a very strong promise, strong elements of differentiation will be very well delivered. And also, in general, what we said is that we'll spend more time and have an additional pillar in our quality approach into building differentiation elements to improve the marketability of our games. We've been improving gameplay in a very meaningful manner over the years. We have optimized services. Now we are adding a new pillar to make sure that all of our games will stand out and will be able to come with very stronger elements of identity. And then we believe that's going to be a key step change in going for higher marketability and grow our audience to a higher level. Thank you. You're welcome. We will now move on to our next question from Mr. Ray Stochel, Consumer Edge Research. Please go ahead. Your line is now open. Great. Thanks for taking my question. You discuss the introduction of the Battle Pass into Rainbow Six? Is this an additive monetization strategy? Or is it more focused on retention? And why do you think we're seeing so many battle passes in the market from your competitors? Yes. What we first of all, we've seen a very smooth implementation of the mini battle pass that we implemented ahead of the Halloween event. The feedback from players were good. Of course, it's too early to isolate the impact we've had on strong engagement growth and PRI growth from the event to isolate the impact of the Middle East Battle Pass from the event itself. But we see it as a strong retention tool. And we know that when we come with a highly optimized and very pleasant player experience and we come with stronger elements and tools of retention, then naturally, PRI grows to high level. Got it. And are you learning more post Ghost Recon with this implementation of the Battle Pass and Rainbow 6, are you learning more about the best monetization strategy approach for each of the titles that you have coming next year? Was there any worry about launching the titles with a poor monetization strategy and now you have extra time to fix that post launch monetization strategy with that extra 6 to 9 months plus with those titles that you pushed into the next year? We are learning from all the experiences we have. So we are going to make sure monetization is well implemented and that continues to follow our goal, which is always to make sure that players can play 100% of the experience without having to buy in game. And really, what we do is really make sure that people have a good experience in the game and that when they spend lots of time in the game, they can be interested in buying items in games, not the control. We will now take our next question from Matthew Walker of Credit Suisse. Please go ahead. Your line is open. Thanks a lot. I've just got two questions, please. The first one is, can you just tell us a little bit more about what happened on Ghost Recon and you go through these checks and these gating procedures? Can you just explain who does the final checks? How come it wasn't spotted that the micro transactions are not going down very well? Is it the studio that produces the game that does all these checks? So they're kind of they're sort of marking their own homework as it were? Or is it somebody from outside that studio who makes the game that does the necessary checks to make sure it's going to be successful and explain how those checks are going to be done differently in the future? The second question is you saw EA pushed out Battlefield into fiscal 2022. Their argument was around the low installed base for the new consoles, so they need time to get it to a higher level. You're going to be releasing your titles with a, I guess, earlier. So what's your thinking around the timing of releases? And how many releases are going to come in the Q4, the fiscal Q4 of 2021? Thank you. So I will answer the first question. Maybe Fred is going to answer the second one. So I will answer the second question and Fred the first one. We consider that the coming of the new consoles is actually to boost the market quite a lot as what happens with those new consoles is that they the Sony and Microsoft are generally coming with good volume for those new machines. So it's going to be lots of marketing and lots of new machines there that will increase the market potential. And what is important is when you come early on the next generation of consoles, you can sell also your games for a long time. So we are very happy to be close to the launch of those consoles because it's going to benefit all the games we will launch. It doesn't mean that they we will not be happy we will be also happy to have games coming in 2022 that will have more console installs. But here, it's the new console arrival is going to help tremendously. Keeping in mind that at the time of the last transition, we had the launch Assassin's Creed Black Flag, which has been one of the biggest game ever for Ubisoft. So it worked very well at the time of the generation transition. And you have both. Actually, you have the old gen and new gen at the same time. So it's really helping a lot. Now on your first question, let's be clear and step back. The primary point on goth Recon has been that the new formula has been rejected by an important fraction of the place. So of course, we could have improved the final execution of the micro transaction point. But the key point and what we know and what we've learned is that the primary element is to come with a formula that players will love and that the player experience need to be great. And then, PRI comes along naturally. The responsibility is, of course, shared by the studio and the central teams. And in the past, we've had a number of very great experiences in the way we implemented PRI across all our games. We're coming back with the decision we've just made. We're coming back to the point that we need to come with a very well optimized player experience, and that comes from that. Okay. Thanks a lot. You're welcome. Thank you. We will now move on to our next question from Tom Singhalerst of Citi. Please go ahead. Your line is open. Good evening. It's Tom here from Citigroup. One question, and I suppose I probably should have asked this last week because it's not really a 1H related call. But just as I say, with a couple more days to think about it, just wondering with respect to the performance of Ghost Recon and the development so far, whether you think there's anything sort of, I suppose, more structural about the sort of open sandbox type of game. I mean, whether in this well, it just struck me that some of the games people are really excited about have very strong sort of stories and narratives associated with them. And I just would be interested in your perspectives on whether the sort of as I say, the sort of open world sandbox type games are just falling slightly out of vogue, whether that's one of the takeaways from Ghost Recon and to a lesser extent, the performance of Division 2? Thank you. Yes. When we look at the past, our open world setting has been loved by many players and that's been the case for gosf recon as well. Gotzrica and WiLAN. Gotzrica and WiLAN. So that's proven to be a very great competitive advantage for Ubisoft in the long run. What we know is that we have to come with a compelling story and marketability of the places you go, which is also more appealing than what we had. That's what we see now is that it's very important to make sure the story and that even if it's in an open world, it's really well worked and that the characters are stronger. Keeping in mind that we had step change the audience of Gulf Recon by coming into an open world. Got it. Got it. And is that something that's on the agenda with these delays, just a little bit more emphasis on the story and the characterization? We're going to that's the kind of gates we are putting to make sure we work harder on the characters, on the settings and making sure we did that a lot more than what we did before. The key element of differentiation and identity are very much around the sense of purpose we're building, the sense of antagonism along together with the element that you mentioned around character and narratives. Of course, it will depend on each and every game genre. On the gameplay side, we made a lot of progress. And the experience in Costa Rican is a fantastic experience. So the second step is to make sure that we work harder on the other elements. Got it. Thank you very much. You're welcome. We will now move on to our next question from Charles Scottie of Kepler. Please go ahead. Your line is now open. Yes. Good evening. I've got three questions, please. The first one is on Rambus siege. Why the approval process in China is taking so long in your view? Is there any blocking point? The second question, I'm just curious to hear your suit on the success of Call of Duty Mobile and Warfare because last week you kind of suggested that the yearly sequel days business model was clearly questioned, but it seems that this success means that it's still relevant. And my third question, last week you talked about that your 5AAA games will be compatible on both consoles generation. So does that mean that if a gamer buy a game on PS4, you will be able play it on PS5 with while benefiting from the upgrade graphics? Or I was just talking about the backward compatibility? Thank you. Yes. So on Rainbow 6, it's in China. It follows the normal process and it's well underway. It takes time, but we feel we can't say much more, but it's well underway. That's the only thing we can say. Yes. On the comment we made last week in terms of space between releases, it was very much around the multiplayer life co op type of games. So that there are different genres than what you mentioned for Call of Duty, which is a PVP. Yes. On the 5 cycles, yes, they will be compatible they will be on this generation and next generation of consoles. And they will take advantage full advantage of all the new features that are coming with the machines, which are actually going to be extremely interesting for players as you will be able to download a lot faster new content. The experience will the players will experience a better frame rate. So there are lots of very good elements that will come with those new machines. Thank you. Thank you. We will now move on to our next question from Mike Ng of Goldman Sachs. Please go ahead. Your line is open. Hi. Thank you very much for the follow-up. I just had a few housekeeping questions. Could you just clarify, Frederic, when you said growth in the 2nd semester of fiscal 2020 for PRI, was that sequentially versus the first half or year over year? And could you just clarify what the outlook for PRI is for the full year? And then could you just talk a little bit about Green Panda? How much did it contribute in the quarter and what's the run rate? Thank you. Yes, on PRI my comment on the growth was for Rainbow Six Siege relative to last year. Well, I didn't I don't think I made any comment on the overall PRI globally. What we said is that we expect Tiara as a percentage of net booking, of course, to be significantly higher than last year. Green Panda. Yes. On Green Panda, it's been a meaningful contribution relative to the mobile over performance. But it's still small. But it's still relatively small. Okay. Thank you. Thank you. We will now take our next question from Benjie Skulik of Arete Research. Please go ahead. Your line is open. Hi. Thanks for taking my question. It's just on cross play. I was wondering if you can comment on whether you see any increase in engagement in Brawlhalla after introducing cross play feature And whether you have any plans to implement the feature across your larger franchises and what you think you could do for engagement? Yes. Our goal is to put cross play on all the games that all the PVP games that we have over time. So that's really well underway. On Borale, it's still early to draw any conclusion. We believe it will contribute to continue increasing engagement, but it's too early to draw final conclusion. We've been very happy with a very strong growth of Borlala again in Q2. But that's all we can say at this stage. Okay. Thanks. Thank you. We will now move on to our final question from Ken Rump of Jefferies. Please go ahead. Your line is open. Hi. Thanks for a follow-up, gentlemen. Just thinking about cadence and your rolling 3 year plan, obviously, we don't know the details, but we know you were planning 4 games for the current year, presumably 3 or 4 for next year, 3 or 4 for the year after. You've therefore you pushed 3 games into next year, turned it into a 5 game year, shunted skull and bones into the year after. There seems therefore a possibility that the numbers go 1 game, 5 games, 3 games, which raises the question that was raised earlier about, aren't you overloading 'twenty one and running the risk of a disappointment in 9 months' time when you might reasonably say, we want to make sure that all these games go well. So maybe it's only 4 after all and 4 the year after. So perhaps just a little bit about sort of the cadence and sort of capacity to launch many games in 1 year. Thank you. Yes. First, what is important to consider is that as those games would be were to be finished in Q4, what we are going to put in the 3 games that you will have next year is improvements, a lot of polish and a lot of testing. So it's the amount of work will be less important than what we do on a full new game. So that's one element. And then Frederic? Yes. And on the 2 biggest franchises, we have a stronger visibility. We've reviewed them thoroughly. So it's coming along well. It appears there are no further questions at this time. I'd like to turn the conference back to you for any additional or closing remarks. So thank you for all your questions today and have a good evening or a good day.