Q2 2013 – MMO Fallout

Funcom has released their 2nd quarter finances for 2013, and the results are certainly figures. So for the sake of brevity, let’s go over some figures, shall we? Revenues in Q2 more than doubled those from the same time last year, however Funcom has yet to return to a positive cash flow. Revenues reached 5.4 million, however earnings before interest in tax -253 thousand, a massive improvement over the -47 million from same time last year. Funcom began a restructuring process earlier this year which concluded in May and has left the company close to cash flow neutral, burning just forty two thousand compared to the four million from last quarter. More cash flow improvements are expected to be seen in the latter half of the year.

On the game side, Age of Conan and The Secret World continue to be Funcom’s major sources of revenue, with The Secret World noted specifically for positively affecting the developer’s cash flow. Last quarter, Funcom consolidated its studios into a single location in Durham, North Carolina, focusing on running the existing portfolio as well as working on additional titles.

Funcom’s continuing projects include structuring the Dreamworld engine so that it can be used in mobile and tablet systems. Work continues (allegedly) on the engine updates for Anarchy Online. Funcom’s upcoming games include LEGO Minifigures Online as well as a slate of mobile titles and work-for-hire operations that encompass lower development periods and faster sources of revenue.

(Source: Funcom Release)

NCSoft has released their second quarter results for 2013, and the news as always is a combination of the good and the bad. Revenues grew thanks to a major spike in sales in Lineage. Sales in Lineage II and Blade & Soul remained mostly stable, while Guild Wars 2 sales dropped by 20%. Sales are up 4% over last quarter, with operating profit up 12%. Pre-tax income dropped 10% compared to last quarter, while net income is down by more than a third (35%). Aion is reportedly running strong in China, and Lineage is enjoying its highest sales ever thanks to a healthy population of players and strong in-game item promotions.

Korea increased its share of NCSoft’s resources and currently carries 67% of NCSoft’s sales per region, with sales in Japan (8%) and via royalties (7%) raising slightly. North America and Europe have continued their downward trend after the spike following the launch of Guild Wars 2, and now stand at approximately 10% and 7% respectively. Taiwan remains flat at slightly more than 1% of NCSoft’s market share.