Suicide Squad flop leads to 41% drop in Warner Bros. gaming revenue

Warner Bros. Discovery’s gaming revenue fell 41 percent year-over-year due to the “weak performance” of Suicide Squad: Kill the Justice League.

The decline was part of an overall four percent decline in studio revenue (gaming, TV, cinema), as shown in the company’s latest quarterly report.

Warner Bros. Discovery has yet to release exact sales figures for Rocksteady’s Suicide Squad game, though the company’s chief financial officer, Gunnar Wiedenfels, said in a February earnings call that the game “did not meet our expectations.” It was later revealed that the company lost $200 million on the game.

A big reason for this decline is of course the huge success of Hogwarts Legacy last year. It was one of the best-selling games of 2023, and by January 2024 had already sold over 24 million copies. Many releases would pale in comparison to others.

Yet Suicide Squad appears to be performing particularly poorly. In June, reports surfaced of a tumultuous development driven by a toxic culture of perfectionism and an ever-changing vision. The game was delayed multiple times after an infamously disappointing showing at PlayStation’s State of Play showcase in February 2023.

During the earnings call, Warner Bros. Discovery CEO David Zaslav and president of worldwide streaming and games JB Perrette were asked about the gaming sector’s “uneven performance.”

Perrette emphasized the importance of free-to-play games, while Zaslav noted the potential for licensing the company’s various franchises to other gaming companies (thanks, IGN).

“We know that for our franchises, especially in a world where the gaming industry is increasingly finding it difficult to launch brand new franchises. This is due to a number of reasons, including the elimination of IDFA and the increased challenges of marketing and customer acquisition,” Perrette said.

“And that franchises like ours are very desirable and can help launch games. You still need a great game and the reality is that we’ve had the unfortunate – in a short period of 12 months we went from having a record year in 2023 with Hogwarts Legacy to unfortunately the other end of that spectrum with Suicide Squad. And it’s still the hit-driven nature of part of that business, but one of the areas that we’re particularly focused on, which is about half of the $200 billion games business, is the free-to-play space.”

According to Perrette, this led to the company acquiring MultiVersus developer Player First, because “strengthening our capabilities” in free-to-play games would provide “greater balance in our games business versus the inevitable cyclicality of more console-based releases.”

Zaslav added: “We have 11 studios here and we have a lot of IP. And there’s also a lot of interest from others to come and take advantage of some of that IP for gaming, which we’re looking at. Because like JB said, we need to get bigger and the IP that we own and the value that it has in the gaming space is something that we want to take advantage of.”

Rocksteady recently launched the second season of Suicide Squad, starring Mrs. Freeze. It is unclear, however, whether this has led to an increase in players.

Warner Bros.’ next major console game will be the Wonder Woman project, developed by Monolith Productions with support from WB Games Montréal. Warner Bros. has confirmed that it will not be a live service game.