Warner Bros. is facing significant challenges following a 41 percent year-over-year drop in gaming revenue for the second quarter of 2024. The company is reportedly pinning its hopes on a sequel to Hogwarts Legacy to help turn its fortunes around. This information comes in the wake of disappointing performance from Suicide Squad: Kill the Justice League and recent job cuts.
Focus on Hogwarts Legacy Sequel
During a conference on Wednesday, Warner Bros. Discovery’s chief financial officer, Gunnar Wiedenfels, emphasized the importance of developing a sequel to Hogwarts Legacy in the coming years. “A successor to ‘Hogwarts Legacy’ is one of the biggest priorities in a couple of years down the road,” he stated at the Bank of America’s 2024 Media, Communications & Entertainment Conference. He added that the gaming division will play a significant role in the company’s growth strategy.
Warner Bros. has set ambitious goals for the Hogwarts Legacy sequel, given the success of the original title. Developed by Avalanche Software, Hogwarts Legacy emerged as the top-selling game of 2023, with over 22 million copies sold by year-end. Earlier this year, David Haddad, president of Warner Bros. Interactive Entertainment, reported that the game sold two million copies just during the Christmas holiday season.
Disappointing Performance of Suicide Squad
In contrast, Warner Bros. Games has been unable to replicate that level of success with its recent releases. Suicide Squad: Kill the Justice League, which was expected to be a major title for the studio this year, ended up as a critical and commercial disappointment, resulting in a $200 million loss for the company. The earnings report for Q1 2024 acknowledged that games revenue declined sharply due to the prior quarter’s performance of Hogwarts Legacy and the underwhelming launch of Suicide Squad.
In the second quarter, Warner Bros. reported a substantial 41 percent decline in games revenue year-over-year, driven largely by the lackluster reception of Suicide Squad. This live service looter-shooter faced criticism for its gameplay and model, especially considering Rocksteady, the game’s developer, is renowned for its acclaimed single-player experiences from the Batman Arkham series.
Wiedenfels also described the performance of Suicide Squad as a “miss” in his recent comments.
Earlier this week, Warner Bros. added to its lineup with the launch of Harry Potter: Quidditch Champions, which focuses on the magical sport featured in the Harry Potter universe. The game is now available on PC, PS4, PS5, Xbox One, and Xbox Series S/X.
