In what one would possibly say is a outstanding instance of understatement, Warner Bros. Discovery mentioned in a letter to shareholders that 2024 was “a disappointing yr” for its video games enterprise, which suffered a 53% lower in income in comparison with 2023. Despite that large hit, Warner has excessive hopes for 2025 because of its latest restructuring, which it says will allow it to “refocus our assets and capital on confirmed IP and video games from confirmed, world class studios.”
That restructuring, in fact, noticed the latest closures of WB San Diego, Player First Games, and the legendary Monolith Productions, in addition to the cancellation of the Wonder Woman recreation that was introduced in 2021. All of that got here within the wake of the spectacular failure of Suicide Squad: Kill the Justice League and the fizzle-out of Multiversus, which was much less overtly cataclysmic than Suicide Squad’s bomb however nonetheless notable as a result of the sport had come out so strongly, earlier than Warner determined for causes unknown to take it offline for practically a yr and rework it. Between them, the 2 video games ended up dropping roughly $300 million.
Despite that, Warner continues to see videogames as “a strategic differentiator,” which “permits us to faucet into one of many quickest rising media segments and the over three billion world players.” But its focus sooner or later, because it mentioned when it confirmed the closures of Monolith and the remainder, will likely be on “4 tentpole franchises which have every generated over $1 billion in shopper gross sales in previous years: Harry Potter, Game of Thrones, Mortal Kombat, and DC—significantly high tier characters like Batman.”
“Just two years in the past, our Games staff broke via with Hogwarts Legacy and created a totally new gaming franchise that was the best-selling recreation of the yr—a consequence that solely three different franchises within the final 15 years have achieved. That provides us confidence that with our re-focused technique we are able to get again to producing high-quality video games constructed for long run shopper engagement, which we anticipate to propel our Games division again to revenue in 2025 and emerge as a extra vital contributor to progress within the years forward.”
Warner’s been banging this specific drum for some time now, so it is not as if that is some shock strategic shift that is going to catch the world off guard. But it does body how the corporate views videogames extra starkly than I feel we have seen prior to now—not as a medium of expression or leisure in its personal proper, however merely a system of help for IP that folks like or acknowledge.
It’s an fascinating takeaway given the ample proof {that a} large title will not carry the day by itself: Hogwarts Legacy was an enormous hit, however Harry Potter: Quidditch Champions goes nowhere and Harry Potter: Magic Awakened was closed in October 2024, simply over a yr after it launched. I am unable to even consider a Game of Thrones recreation that is made a lot of a splash, except for possibly Telltale’s 2015 journey sequence. (The subsequent GoT recreation has a demo on Steam proper now, and possibly it will go someplace.) People do like superheroes, although, so possibly that’ll work out. (Just not, y’know, Wonder Woman.)
What could assist Warner’s video games division greater than tentpoles is a latest change on the high: Longtime video games chief David Haddad introduced in January that he is stepping down from the position. A latest Bloomberg report cited quite a few sources who laid the blame for Warner’s videogame woes at Haddad’s toes, saying his tenure was marked by indecision and an absence of coherent imaginative and prescient.
