NCSoft Income Dips In Q2, Lineage Is Doing Just Fine

NCSoft this week released their second quarter earning reports and the results are not entirely great, but not entirely bad. While sales dropped 6% over last year, profits are down 19% with net income down 17% over the same period. NCSoft’s mobile titles are still going very strong and now make up the vast majority of the company’s revenue with Lineage continuing to be the breadwinner on the traditional MMO side.

Lineage launched a remaster update and revamped monetizations that has been credited for a spike in sales and has seen user numbers more than double. NCSoft believes that this rebound revenue will remain solid and that other updates in the second half will maintain revenue numbers. According to NCSoft statements, Lineage M continues to maintain its highest numbers ever. NCSoft also expressed pride in Lineage II, noting that “the fact that a game in its sixteenth year is achieving 55% YoY growth is extremely encouraging for us,” with more updates coming in the second half of the year that should accelerate growth. There were no additional notes for Aion, Blade & Soul, and Guild Wars 2.

The second half of 2019 is set to bring Lineage II M to the market which NCSoft hopes will shake up the market with its differentiated content. Aion 2 and Blade & Soul 2 are progressing smoothly with NCSoft taking aim to ensure that the games are received well not just in Korea but in the international market as well. Lineage II M is set to launch in the fourth fiscal quarter 2019 followed by international launch in a “timely manner” with minimal gaps. They did acknowledge concerns with the Korean MMO market due to underperformance of recent launches in the country and whether the market has further growth potential. NCSoft stated that their own internal numbers indicate that there is a large potential demand of customers “waiting on the sidelines” for something to appear, and that Lineage II M is exactly the title that can satisfy that pent-up demand, however they do recognize that adding overseas revenue is necessary and that Lineage II M will cater to that market.

As for NCWest, NCSoft noted the company is going through a “process” to improve efficiency from the studio, but does not see a significant decrease in labor costs from the entity in the coming year which should assuage fears of further layoffs.

On the topic of cloud/console gaming, it was stated that PC titles from the beginning will be designed to be played on a console format going forward. There are internal projects looking into cloud gaming, but nothing that could be discussed at this time. ArenaNet is looking at several projects including a potential mobile Guild Wars 2, however there are no solid titles that could be announced at this time as all of the projects are still under review.

(Source: NCSoft quarterly income)

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