Aristocrat Leisure suspends mobile gaming in Russia, evacuates staff in Ukraine

The poker machine giant suspends mobile gaming in Russia and evacuates staff in war-torn Ukraine.

Aristocrat Leisure boss Trevor Croker says the company is leading a ‘comprehensive response’ over Russia’s invasion of Ukraine.

Poker machine giant Aristocrat Leisure has suspended its mobile gaming business in Russia over Moscow’s invasion of Ukraine – a move that is set to shave about $US50m ($68.7m) off the bookings for its digital division Pixel United.

Russia “historically” contributes about 3 per cent of Pixel United’s annualised bookings, which totalled $US1.84bn last year, a 14 per cent increase on 2020, according to the group.

Aristocrat is the latest company to suspend its Russian operations, joining McDonalds, financial titans Visa and MasterCard, and oil giants BP and Shell.

As revealed in The Australian, Aristocrat is also evacuating its Pixel United staff in the Ukraine. In a statement to the ASX on Wednesday it said it had relocated almost 70 per cent of its 1000 Ukraine staff and their families either internationally or to safer parts of the country.

“The wellbeing and safety of our people remain our highest priority and Aristocrat’s Pixel United team continues to lead a comprehensive response,” Aristocrat said.

“A special task force has been set up in Poland to assist staff and families on the ground. Aristocrat is providing transport, visas and legal help, housing and settling-in assistance for relocated staff.

“Aristocrat is also making every possible effort to support employees and their families that remain in the country. This includes providing funds, shelter, emergency supplies and other direct aid. We are also continuing to strongly encourage and support those able to relocate to do so, as quickly as possible.”

Pixel United, formerly Aristocrat Digital, includes three mobile-first games publishers: Product Madness, Plarium and Big Fish games.

The company says it does not expect any “material impact on earnings as a result of the crisis” with all relocated staff working remotely and supported by other Pixel United studios in Europe.

“A new office will open shortly in Wroclaw, Poland, adding to our existing operations in Poland, and supporting further talent acquisition over time.”

Ukraine is home to many game and app developers, many of whom are displaying their own form of resistance to Russia’s invasion.

One popular app, Reface – which uses artificial intelligence to put the face of users on celebrities’ bodies – has moved to fight the Kremlin’s disinformation campaign, notifying its users across the globe, and in Russia, about what’s happening in Ukraine.

Meanwhile, Russian President has signed a new law – with a penalty of up to 15 years’ prison – that bans words like “war” or “invasion” to describe Russia’s actions in Ukraine.

Aristocrat also has Pixel United staff in Russia and says it is exploring “strategic options” about their ongoing employment.

“Unfortunately, operating in Russia is currently not viable and Aristocrat confirms it will suspend operating our mobile games in Russia. Russia has historically contributed approximately 3 per cent of total annualised Pixel United bookings.

“We will continue to do what we can to support our Russia based employees.

“Pixel United is continuing to actively manage and prioritise game content release schedules. We will continue to closely monitor impacts given the fluid situation, and provide an update at Aristocrat’s half year financial results in May.”

It comes as Aristocrat says it is making progress building its own online casino platform following its failed $3.9bn bid for British gambling software group Playtech.

The company is now expanding into real money gaming to take advantage of the booming online casino market – the total revenue of which is expected to surge 13 per cent to $US112bn by 2025 – and for the past 12 months has been building its own platform.

Aristocrat chief executive Trevor Croker said its RMG strategy was a “medium-term effort” and would sit alongside the Pixel United business, led by Mitchell Bowen.

“Aristocrat’s a company that grows by taking share in the markets we participate in and we invest heavily, over $500m every year … to make games to grow the business. So we’ve been steadily continuing to drive growth every year and then we use M&A to accelerate the growth,” Mr Croker said following the group’s annual meeting last month.