F1 Manager developer Frontier has suffered layoffs after disappointing F1 Manager sales.
According to GamesIndustry.bz, the news was announced to investors as part of an organisational review as Frontier plans to "refocus on its core strengths following a period of disappointing financial performance and more challenging industry conditions."
Frontier suffers layoffs
Frontier is aiming to reduce its annual operating costs by up to 20%. Unfortunately, this will result in an unknown number of redundancies at the company, spending cuts, and a recruitment freeze. Frontier’s organisational review is expected to conclude by early 2024.
GamesIndustry.bz reports that Frontier’s revenue dropped 8% to £104.6 million for the last financial year, with a £26.6 million operating loss compared to an operating profit of £1.5 million the previous year. Unfortunately, one key factor of these losses is the F1 Manager series' underperforming.
F1 Manager sales disappoint
F1 Manager 2023 launched in July to positive reviews, but sales for this year’s entry are lower than expected. According to a Frontier FY23 financial results presentation, F1 Manager 2023 pre-orders were "lower than last year." This led to F1 Manager 2023 being discounted on Steam just one month after launch. Post-launch sales are "more encouraging," however.
Frontier's revenue projections are lower than last year, but the studio has "positive steps to maximise sales" of F1 Manager 2023.
Last year’s games similarly underperformed. In an earnings report ending November 2022, Frontier announced F1 Manager 2022 sales fell “materially below original expectations,” with over 600,000 copies sold. Following its release, Frontier’s share price dropped by 40%.
At the time, Frontier blamed “increased player price sensitivity related to worsening economic conditions." F1 Manager 2022’s low sales forced Frontier to lower its revenue projections for the 2023 fiscal year. It went on to sell over 800,000 copies in FY23.
F1 Manager 2023 introduces several welcome new features including driver confidence, pit crew training, and a new tyre temperature system. There's also a Race Replay scenario mode and this week’s 1.9 update added new career difficulty settings. Unfortunately, these incremental improvements haven’t piqued players’ interest.
According to Frontier's latest financial report, plans for F1 Manager 2024 are still in development. Frontier has exclusive rights to the F1 Manager series until 2025. After that, the future of F1 Manager looks uncertain if the series continues underperforming.
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