Tag: Revenue

Activision Blizzard Q4 Finances: Lesser Billions


Activision Blizzard has released their fourth quarter financial reports and if you were hoping the company would burn to the ground following last year’s Hearthstone debacle, well you’re going to be sorely disappointed.

The positive side of this year’s Q4 report is that Activision didn’t pair an announcement of record revenues with hundreds of layoffs. We still expect the company to siphon a few hundred million in taxpayer dollars for simply existing in 2019. Unfortunately Activision hasn’t been able to keep up its record results from last year as the company has seen multiple straight quarters of revenue loss. Sad for the investors, but since Activision isn’t infinitely expanding not quite a surprise.

Despite this, Q4 results exceeded expectations according to Bobby Kotick.

“Our fourth quarter results exceeded our prior outlook for both revenue and earnings per share,” said Bobby Kotick, Chief Executive Officer of Activision Blizzard. “Our recent Call of Duty® success illustrates the scale of our growth potential, as we expanded the community to more players in more countries on more platforms than ever before. With our strong content pipeline across our franchises and momentum in mobile, esports, and advertising, we look forward to continuing to delight our players, fans and stakeholders in 2020 and beyond.”

Net revenue dropped from $2.3 billion for Q4 2018 to $1.98 billion in 2019, while overall net bookings similarly fell. Activision boasted a monthly average user rate of 409 million with a large portion coming from King (249 million) and of course the ongoing success of Call of Duty, World of Warcraft, and Overwatch.

Investors are happy because Activision increased dividend payouts by 11% and you have to focus on the important things.

Source: Activision

In 2018, Activision Blizzard Got $228 Million From Taxpayers For Existing


If you live in the United States and thought you could get away with not giving Activision money simply by not buying their products, you’re in for a nasty surprise.

ITEP, the Institute on Taxation and Economic Policy, posted a list of 60 companies avoiding all federal income taxes in 2018.

“For decades, profitable Fortune 500 companies have manipulated the tax system to avoid paying even a dime in tax on billions of dollars in U.S. profits. This ITEP report provides the first comprehensive look at how corporate tax changes under the 2017 Tax Cuts and Jobs Act affect the scale of corporate tax avoidance. The report finds that in 2018, 60 of America’s biggest corporations zeroed out their federal income taxes on $79 billion in U.S. pretax income. Instead of paying $16.4 billion in taxes at the 21 percent statutory corporate tax rate, these companies enjoyed a net corporate tax rebate of $4.3 billion.”

Activision Blizzard notably started out 2019 with the best results in company history, which they celebrated by firing nearly a thousand workers. While celebrating their major financial success and putting hundreds of people out of work, Activision also wound up claiming a -51% effective tax rate. Yes, Activision got $228 million from US taxpayers simply for existing.

We should all get a ride on Bobby Kotick’s private plane. We helped pay for it after all.

Source: ITEP

Netmarble Posts $72.9 Million In Quarterly Profit


Netmarble; you know them from Lineage II Revolution and Marvel Future Fight among other things.

This week Netmarble posted their third quarter financial documents and the results are pretty good. Company sales amounted to $533.5 million resulting in $72.6 million in operating profit and $72.9 million in net profit over the quarter spanning July to September. Quarterly sales increased 17% over last year while net profit increased 53.7% compared to the same time in 2018.

“Netmarble had significant increases in both sales and operating profit in Q3, reflecting both domestic and overseas performances of new games launched in Q2”, said Young-sig Kwon, CEO of Netmarble. He added, “At G-Star 2019, we unveiled the highly anticipated new game titles ‘Seven Knights Revolution’ and ‘Ni no Kuni: CROSS WORLDS’ for the first time and introduced ‘A3: STILL ALIVE’ and ‘Magic: ManaStrike”

Netmarble’s big revenue machines are Marvel Contest of Champions and Lineage II Revolution each pulling 14% of the company’s total sales. Upcoming titles include Magic: ManaStrike, A3: STILL ALIVE, Seven Knights Revolution, and Ni no Kuni: CROSS WORLDS.

Source: Press Release

Call of Duty, WoW Classic Make Activision Blizzard Mucho Dinero


The success of World of Warcraft Classic could only come as a shock to J. Allen “You think you do but you don’t” Brack, but to the rest of the world the idea that the classic servers brought back a lot of players isn’t surprising in the least.

Activision released their third quarter statements for 2019 and the results are pretty great for them. With sales from Call of Duty BLOPS 4 and WWII still strong and World of Warcraft Classic leading the way, Activision hauled in $1.28 billion dollars compared to $1.51 billion in 2018. World of Warcraft Classic drove subscriptions to its highest quarterly increase in franchise history while Candy Crush somehow continues to grow in revenue. In addition, the launch of Call of Duty Mobile has been a major success in terms of downloads and revenue.

Despite recent controversy, Blizzard has created a good amount of hype with the announcement of Overwatch 2 and Diablo IV at this year’s Blizzcon.

The quarter ends on September 30 and does not reflect any potential consumer reaction to the Blitzchung Hearthstone controversy, nor does it include sales from the latest Modern Warfare title.

Source: Activision report

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

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)

[NM] Rockstar North Paid No Taxes, Earned Tax Relief


It’s hard to look at Rockstar North and not see dollar signs (or pound signs) around the massive success of Grand Theft Auto V, but this week’s news is sure to set some fires in more than a few bellies as the company’s finances come into more scrutiny.

TaxWatch UK a thinktank that tracks business earnings reported this week that Rockstar North has made an estimated $5 billion in profit over the last six years. Despite this massive amount of profit, the company still determined that it deserved tax relief and claimed £42 million between 2015 and 2017, or 19% of all government credits issued to the industry during that period. And with all of this income, can you guess how much Rockstar North paid in taxes? That’s right, absolutely nothing between 2009 and 2018.

The thinktank noted:

“It is outrageous that the UK taxpayer is being asked to shell out tens of millions of pounds in subsidy to the developers of Grand Theft Auto, when at the time that the game’s developers put in their tax credit application Grand Theft Auto V had already generated several billion dollars in sales and profits. This is a drive-by assault on the British taxpayer and corporate welfare scrounging at its very worst.”

It should also be noted that no one is claiming any illegal activity on the part of Rockstar North. The news of Rockstar’s nonexistent tax bill is likely to come off as especially egregious considering the company recently opened up a literal casino in Grand Theft Auto V where players from certain countries are able to buy virtual chips with real life currency.

(Source: TaxWatch)

Lods of Emone: Jagex Posts Record Financial Success


RuneScape is doing just fine, thank you.

This week Jagex released their 2018 financials and boasted a 9.3% increase in revenue to £92.8 million. 2018 saw RuneScape reaching its highest membership total ever with Old School RuneScape launching on mobile and seeing over five million downloads.

CEO Phil Mansell noted:

“This lets us accelerate Jagex’s transformation; we have strengthened our leadership team and will continue to build on the company’s talent base, we are funding new game development, building out our third-party live game publishing, investing in massive publishing platform upgrades, whilst continuing to expand our live RuneScape games.”

The last year has seen Jagex increase its team by more than 100 people with investments in research and development boosted by 69%. 2018 also marked the launch of the Jagex Partners Initiative which aims to deliver operational services tailored toward third party studios.

Source: Jagex Press Release

Pearl Abyss Announces $1 Billion In Black Desert Online Revenue


Black Desert Online developer Pearl Abyss is breaking out the name brand Lunchables this week, and with good reason. The developer announced today that Black Desert has raked in one billion dollars in gross sales across all platforms. The title is available in over 150 countries and boasts 18 million users.

Robin Jung, CEO of Pearl Abyss, commented;

“We’re proud of what this achievement represents – the hard work and dedication from our teams over the past four years and the support from a community of fans around the world. With over 30% of gross sales for Black Desert stemming from mobile platforms, which saw an initial release in Asia in the past year, we’re confident that sales are accelerating. Pearl Abyss is optimistic for the future of Black Desert, and we look forward to launching Black Desert Mobile globally by the end of the year.”

Pearl Abyss formed in 2010 with a team of just seven employees. The company has expanded massively since then, and in 2017 acquired Eve Online developer CCP Games. In 2018, Pearl Abyss launched the remastered update for Black Desert Online while also working on expanding into the console sector.

Source: Pearl Abyss Press Release

Activision Blizzard Celebrates Record Results With Mass Layoffs


Activision CEO Bobby Kotick announced in an investor earnings call today that the company will lay off nearly 800 employees, mostly in non-game-development areas. The layoffs are expected to impact Activision, Blizzard, and King studios. The decision comes after the company achieved “record results” in 2018, however not as high as investors had hoped for.

Last year Activision parted ways with Bungie following the less than stellar launch of Destiny 2’s latest expansion. Last year’s announcement of Diablo Immortal, a mobile spinoff in development in conjunction with Netease, was very poorly received. Black Ops IIII meanwhile has proven to be very popular with its Blackout battle royale mode.

Bobby Kotick stated:

 “While our financial results for 2018 were the best in our history, we didn’t realize our full potential. To help us reach our full potential, we have made a number of important leadership changes. These changes should enable us to achieve the many opportunities our industry affords us, especially with our powerful owned franchises, our strong commercial capabilities, our direct digital connections to hundreds of millions of players, and our extraordinarily talented employees.”

MMO Fallout sends our regards to those affected by the layoffs. In response to the layoff announcement, support has been pouring in from around the internet with various developers posting their job openings and offering assistance to those affected. According to Activision, laid of employees will receive a severance package, health benefits, and career placement assistance. Activision stocks jumped by about $2 in after-hours trading.

The recently unemployed (or even others) are encouraged to check out this Google doc in which dozens of developers have been listed with openings.