What’s that spell? Loads of money! Probably.
NCSoft has released their second quarter financials for 2020 and the results are pretty good. While sales were down 26% from the last quarter, they are up 31% over the same period last year. Operating income dropped 13% QoQ but managed a 61% increase over the second quarter in 2019. Similarly pre-tax income went down 15% over last quarter but up 47% over the same time last year. Net income was down 19% from last quarter, up 36% from last year. Annual growth is more important than quarterly growth, so good news all around.
It’s worth noting that a large portion of the quarterly drop is due to an explosive and unsustainable growth in Lineage 2 Mobile that took place in Q1 2020. To put it in perspective, Lineage 2 M brought in 143 billion KRW in Q4 2019 ($120 million USD approx.) which exploded to 341 billion ($290 million) in Q1. That number has come down to 197 billion ($170 million) which is still a ridiculous amount of money for a mobile game in a fiscal quarter. Lineage M saw a moderate drop from 212 billion KRW to 159 billion.
Also worth keeping in mind is that mobile is now a big sector of NCSoft’s income. We’re talking 77% of NCSoft’s quarterly sales coming from Lineage M and Lineage 2M compared to Lineage, Lineage 2, Aion, Blade & Soul, and Guild Wars 2 put together. The good news on the PC front is that Guild Wars 2 saw a modest increase in sales, however nothing else fared quite so well. Lineage 2, Aion, and Blade & Soul all saw very small decreases in sales. Lineage however dropped about 25%.
As one would expect from the deflation of the Lineage mobile titles, Korea’s share of sales fell significantly (33%) North American sales increased 27% driven by Guild Wars 2 due to Covid 19. Royalty sales increased 18% because of Lineage Mobile and an Asian launch of a mobile game based on Blade & Soul. Also good news is that operating costs dropped 33% with labor costs down 23% now that NCSoft isn’t paying Lineage 2 Mobile employee incentives. Marketing is also down severely (67%) as there were no new game launches.
Source: NCSoft
MMO Fallout 