NCSoft releases Q4 sales.
Tag: Finance
Funcom Quarterly Report Notes 10 Active Projects
Funcom has released their third quarter financial performance and the results are up and down. Revenue is down from $7.5 million last year to $5.4 million this year which can be blamed on Conan Exiles having a strong launch in Q2 and Q3 of 2018. Funcom did not launch a title in Q3 2019, however they did admit that Conan Unconquered has underperformed to Funcom’s expectations.
Funcom’s MMO library has been relegated to a tiny corner of their report, simply mentioning “community events” for activities encompassing Age of Conan, Secret Worlds Legends, and Anarchy Online (The Secret World isn’t referenced at all). The financial report also notes that Tencent recent acquired a 29% stake in Funcom over the quarter, offering no cash infusion to Funcom itself as the stocks were purchased from KGJ Capital AS.
“We are very pleased to see Tencent come in as the largest shareholder of Funcom. Tencent has a reputation for being a responsible long-term investor, and for its renowned operational capabilities in online games. The insight, experience, and knowledge that Tencent will bring is of great value to us and we look forward to working closely with them as we continue to develop great games and build a successful future for Funcom.“ Rui Casais
After quarter activities so far have included the launch of 2015’s The Park on Nintendo Switch, as well as the release of Moons of Madness on Steam. The report does not discuss sales figures, however Steamspy estimates 20,000 to 50,000 total sales and Steam charts show the game peaking at 519.
Funcom’s upcoming titles include a Dune open world title that is currently in pre-production, a cooperative shooter set in the Mutant: World Zero IP, Conan Chop Chop set for launch in Q1 2020, Moons of Madness releasing on consoles in January, and two unnamed titles in development by Games Farm and The Outsiders, a studio created by former Battlefield developers.
Source: Funcom
Ubisoft’s Stock Drops Following Ghost Recon Disappointment
This week Ubisoft announced that it would be dramatically scaling back income expectations following the “very disappointing” reception and sales of Ghost Recon: Breakpoint. The latest game in the Tom Clancy franchise left both gamers and critics angry over the abundance of game-breaking bugs as well as what was perceived to be an egregious reliance on over-monetization of various aspects of the game.
In the time since that announcement, Ubisoft’s stock prices have plummeted both in the United States as well as in France. Ubisoft’s NASDAQ listing dropped from $12.60 on Monday to a low of $10.06 before rebounding slightly to $10.35. Bloomberg meanwhile reports that stocks in France fell as much as 29% which brings the year decline to 38%.
In addition to the disappointing reception of Ghost Recon: Breakpoint, Ubisoft announced that all of its major releases for the rest of the fiscal year have been delayed until next fiscal year. Investors were not entirely satisfied by the announcement.
Source: Bloomberg
Funcom Q2 2019: Conan Exiles Strong, Unconquered Not So Much
Funcom this week published their second quarter results for 2019 and they are pretty much okay.
Funcom’s CEO Rui Casais referred to 2019 as a transition year for Funcom between the turnaround and growth phases of the company where those changes may not be immediately visible. Presumably he is referring to Funcom’s revenue and profit for the second quarter which despite boasting a 53% increase from last quarter is moderately over half of last year’s numbers. $8.9 million in revenue in Q2 2019 compared to $15.2 million in 2018 as well as $600,000 in profit compared to $5.8 million in 2018.
The numbers makes sense as 2018 brought in Conan Exiles and Mutant: Year Zero and Funcom didn’t have as big of a title to publish this year outside of Conan Unconquered which didn’t quite live up to expectations. On the plus side, the company has shed its $3.4 million in debt since last year and is in a strong, growing cash position.
With Conan Unconquered we saw an opportunity to experiment with a low budget game in a new genre for Funcom, “Real-Time Strategy”. We worked with a developer with a long track record in the genre to create a small game that isn’t a classical example of the genre, but a twist on it. Unfortunately, the reception from the players was not as positive as we hoped for. We are grateful for their feedback and based on that feedback we have made free updates to the game and have a larger update ready to go out soon. We are improving our processes based on this experience and we still believe in this genre, but it’s clear that the budget and quality of this game was not high enough.
Conan Exiles continues to be the strong performer in terms of revenue and funding Funcom’s other projects. The report does note that the success of Conan Exiles showing the company’s strength in multiplayer games as a service, that the Conan single player game has been put on hold in order for the Oslo team to focus on continued content for Exiles as well as the Dune open world multiplayer game set to release soon™. The Funcom North Carolina team is working on a multiplayer shooter that they hope to bring to market in 2020, while the company is also publishing Moons of Madness and Conan Chop Chop, as well as other titles yet to be announced.
Dune is currently listed as in pre-production while the coop shooter based in the Mutant: Year Zero IP is in production. Moons of Madness, a game set in the Secret World universe, is on track for a Halloween 2019 release with Conan Chop Chop to come in 2020. Funcom is also engaged in joint operations surrounding the Kult RPG franchise, Solomon Kane, Mutant Chronicles, and Doom Trooper along with other lesser known franchises.
Source: Report, Presentation
Netmarble Posts Q2 2019 Fiscal Results
Netmarble has posted its Q2 2019 financials and the results are a mixed bag. Company sales rose 10.2% over last year to $459.2 million while operating profit plummeted 46.6% to $29 million and net profit dropped 42% to $33.2 million.
“We have been focusing on enhancing our competitiveness by successfully launching new games of various genres in the global market,” said Young-sig Kwon, CEO of Netmarble. He added, “We expect a turnaround in Q3 as new successful titles launched in Q2 will be reflected in full Q3 sales. We also expect the proportion of sales outside of South Korea to continue to increase to 70% in the second half of the year with the launch of Blade & Soul Revolution in Japan, The King of Fighters Allstar in North America, and new games based on our popular franchise games.”
Netmarble’s top performing games include MARVEL Contest of Champions (15%), Lineage 2: Revolution (14%), Blade & Soul Revolution (10%), MARVEL Future Fight (8%), and Seven Deadly Sins: GRAND CROSS (8%) among others. Sales outside of South Korea made up 64% of total revenues and the second half is expected to bring in a number of new titles from YOKAI WATCH: Medal Wars in Japan and Koongya Catchmind in Korea, Blade & Soul Revolution in Japan and THE KING OF FIGHTERS ALLSTAR in North America, along with the Korean launches of its proprietary franchise games, Seven Knights 2, and A3: STILL ALIVE.
Source:
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)
Funcom Q3 2018 Report: Highest Quarterly Earnings In Company History
Funcom yesterday posted its third quarter earnings for 2018, and the results are rather positive. Third quarter earnings amounted to $7.5 million, a 25% increase over last year, with earnings before interest, tax, depreciation, and amortization amounted to $4.6 million. The developer happily notes that not only has cash flow beaten the full year’s numbers for last year, which was the highest in Funcom histroy, but that the company is now free of interest-bearing debt for the first time since 2009 and holds a cash balance of $20.9 million.
On the road ahead, Funcom has six titles in its lineup including Mutant Year Zero: Road to Eden, Petroglyph’s Conan game set for the second quarter 2019, Rock Pocket’s Funcom IP game set for Halloween 2019, a cooperative shooter from Funcom North Carolina, a single-player Conan game from Funcom Oslo, and an open-world multiplayer game also from Funcom Oslo. It appears that Petroglyph’s Conan game will release on PC while Rock Pocket’s title is set for PC, Xbox, and Playstation. Funcom NC’s title utilizes a premium business model while both of Funcom Oslo’s titles are in pre-production stages.
Conan Exiles continues to be a strong seller for Funcom.
(Source: Funcom)
Mobile Dominates NCSoft Quarterly Report
NCSoft’s second quarter finances have been released and they are quite a doozy. While sales grew 8% both quarterly and over last year, profit and income both dropped 56% and 66% respectively thanks to increased labor costs and marketing increases. Just how much? 370%, from 5.1 billion KRW in Q2 2016 to 24.1 billion in 2017. Similarly, labor costs jumped 24% and “variable costs” went up 186%, due in part to a 244% increase in royalty payments. Ouch.
On the game’s side of the report, mobile has dominated NCSoft’s revenue reports and has become the largest sector by a wide margin, even against Lineage which continued to drop in revenue thanks to a lack of promotion over the second quarter. Every other title in NCSoft’s library (as noted below) also dropped by some factor in revenue during this period, with the sale of mobile games making up for their shortcomings. The launch of Lineage M, the mobile Lineage port, is also to thank for a drop in Lineage revenue as some players made the jump over to mobile.
Guild Wars 2 is expected to receive a substantial bump thanks to the impending launch of its next expansion. The full report can be found over at the NCSoft website
NCSoft Releases Quarterly Earnings, Lineage M Sees Lower Demand
NCSoft’s quarterly earnings have been made available and the results are not so bad. Sales fell 1% over the same time last year thanks to early recognition of Lineage 1 promotion sales with NCSoft pointing to lower demand than expected for Lineage M, the mobile release of Lineage. Operating profit and income plummeted 60-70% year over year due to incentives paid on the back of high earnings last year, meaning NCSoft players should not see these figures as the end times.
To put it into perspective, NCSoft’s net income dropped from 66,804 (million Korean Won) to 17,394 (49,410) over the past quarter. Labor cost increases due to increased headcount and incentives rose 33% by 33,175 while royalty payments exploded 398% over last quarter by 2,261. In short, while sales fell 1% over last year, operating costs increased 24% due to said overhead costs.
On the games front, Lineage sales plummeted by more than half, however much of that is due to the aforementioned early sales recognition is unknown. Lineage II and Aion similarly dipped in revenue, although not by nearly as large of a margin, while Blade & Soul grew compared to the last two quarters and Guild Wars 2 remained relatively stable. Wildstar, as mentioned in the previous release, is no longer listed on NCSoft’s quarterly reports.
NCSoft Q4 2016: Wildstar Disappears From Report
NCSoft has released their fourth quarter financial statements and the news is quite positive. Compared to the same period last year, sales rose 20% with operating profit up 36% over the same period, thanks to strong performance from major IPs and strong launches in the mobile market. The report notes that sales have hit a historic high thanks to geographical expansion and new business models.
Over on the game’s front, Lineage 1 continues to impress with a 42% increase in sales over last year, an insane jump for an MMO that is going on nineteen years old. Another title to see solid annual growth was Blade & Soul, which continues to be popular as it rolls out worldwide. Lineage II saw a fair amount of growth while Guild Wars 2 continues to rock steadily as it awaits a new expansion pack. The other category contains Lineage Red Knights, whose successful rollout boosted the category by 97%.
One game you may note as missing from the sales breakdown is Wildstar. It isn’t there. It appears that the game’s sales have dropped enough that it is no longer worth listing as a product separate from the “other” category.
(Source: NCSoft Finance)
MMO Fallout 