NCsoft Q2 2017 financials: Guild Wars 2 drops to new all-time low, Blade and Soul heads to console

Ready to take high Asian fantasy to your home console? You’d better because NCsoft recently announced that it is working on adapting Blade and Soul to such platforms. The video game developer and publisher didn’t specify which consoles, exactly, are due to get the full Blade and Soul treatment, but during its investor call this morning, it did reveal that this version would get the same updates as the PC edition and is being made in North America. Bringing Blade and Soul to consoles is only the start of a major initiative by NCsoft to bring more MMOs to that slice of the gaming market. Blade and Soul recently announced a round of server merges while rolling out a series of high-profile patches this summer and fall.

It also saw another drop in revenue for the quarter, along with all of the company’s other MMORPGs, including Lineage and Guild Wars 2, the latter of which saw its fifth straight quarter of dropping sales, marking its worst quarter ever. NCsoft doesn’t appear to be too worried, however, as it’s now reporting its mobile games division as an IP, where it’s making up those losses in large part because of Lineage M (which is likely where a lot of those missing Lineage 1 sales went).

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kalamari_
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kalamari_

to put this in context (the graphs are pretty shitty):

+ GW2 lost 2 billion won over one year

+ AION 7 billion

+ B&S 10 billion

+ Lineage II 2,5 billion

+ Lineage 61 billion

and dont forget all the other games listed are more popular in asia than in the west. GW2 is the only western mmo with a strong western and a very little asian playerbase.

the mmo market in asia is way bigger than in the west.

GW2 will spike to 28-30 billion again with PoF and then decline to 12-13 billion again before the next xpac. its a normal cycle for an b2p mmo.

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Dragon Whimsy

This isn’t really a problem given we have an expansion coming out soon and mount skins will spike gem sales coming up. The real take away from this is how steady GW2 is doing compared to all of their other PC games. Everything else is all over the place, spiking and then dipping drastically, but GW2 has been fairly steady despite it’s last expansion being almost two years ago.

I’m not saying there isn’t any cause for concern but really given how HoT’s was received we already knew it was all up to PoF to turn things around with the wider MMO player base and the jury is still out on that.

It’s Q1 and Q2 of 2018 that I’m more interested in. Not this last quarter before the expansion announcement which you would sort of expect to be the lowest anyway.

deekay_plus
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deekay_plus

gw2’s numbers are now lower than when wildstar was last reported btw.

miol
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miol

nope, below you can find some provided sources…

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Mr_Planthead

Stop arguing about GW2!! I, like most of us, just want to know one thing, is Wildstar turning a corner and will it be making a profit soon??

miol
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miol

Enough is enough! (click to enlarge)

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miol
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miol

Or if you prefer bars and only for the last 5 quarters, like NCsoft:

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deekay_plus
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deekay_plus

pretty sure this graph is incorrect as i distinctly remember wildstar being at 13+ the last time they reported it.

wildstar also launched in 2013 which that graph doesn’t show data for it that far back. it also doesn’t show wildstar’s upwards trends with f2p relaunch.

it also shows gw2’s peak as being lineage case which is simply not even remotely ever been the case in teh life time of gw2. lineage 1 has been a power house for ncsoft for a fair number of years now.

miol
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miol

pretty sure this graph is incorrect as i distinctly remember wildstar being at 13+ the last time they reported it. … it also doesn’t show wildstar’s upwards trends with f2p relaunch.

…instead of looking it up first, through the link provided by this article! :/

Just open the pdf of the right quarter: http://global.ncsoft.com/global/ir/quarterly.aspx

You can see the uptick in my above gragh, if you click on the image to enlarge, as previously recommended, but compared to the other games in this scale it’s barely noticeable.

Since f2p launch was end of September 2015, here are the numbers from 3Q15 to 4Q15: 1.727 billion KRW >> 2.668 billion KRW, compared to B&S for instance: 24.919 billion KRW >> 32.414 billion KRW in the same period of time has a factor of ~10

wildstar also launched in 2013 which that graph doesn’t show data

Again, not looking up first! :/

Launch was June 2014!

http://massivelyop.com/tag/wildstar/

https://en.wikipedia.org/wiki/WildStar_(video_game)

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miol
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miol

it also shows gw2’s peak as being lineage case which is simply not even remotely ever been the case in teh life time of gw2. lineage 1 has been a power house for ncsoft for a fair number of years now.

4Q12: GW2 earned 119 billion KRW compared to L1 with 65 billion KRW

But please, be my guest: http://global.ncsoft.com/global/ir/prfile.aspx?ID=FC9870E1-B7D6-4FB5-88BD-BC624943769A

I know we aren’t on the best of terms, but there is no need to overlook the numbers! :(

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Sally Bowls

1) Whether $13M is good or bad is determined by ANet’s expenses which I don’t know. If there are 50 people in Anet, that is good. If there are 500 people, oops/bye. A quick glance seems that labor is about 20% of revenue at NCSoft so $55M a year could support idk a hundredish devs?

2) NCSoft is committed to the West. The chairman’s wife and children moved here to run and try to turn around NCWest. They quickly grew Iron Tiger Studios to over 150 people. “NCSoft West is also working on building better Westernizations of its existing Korean games” “NCSOFT’s first mobile game for the West (Aion: Legions of War)” “The company’s newest franchise, a multiplayer online battle-arena game called Master X Master, is currently under development by NCSoft’s lead studio in Seoul but will make its global debut in North America later this year. “It’s U.S. first, developed in Korea, with all our feedback from the Western regions,” Yoon says.” This does not mean NCWest is allocating resources in a way you approve of, but it is getting a lot of resources.

3) “Disappointing” has nothing to do with absolutes and everything to do with expectations. If people expect you to lose a billion and you lose 900M your stock goes up. Expect you to make a bil and make 900M and your stock declines. So if NCSoft execs and/or stock analysts were expecting 12, this is good news from GW2. Expecting 14 would make this disappointing.

4) FYI: Scope: Roughly, market capitalization NCSoft is worth US$B 7. In the last quarter, Activision-Blizzard’s market cap increased by that amount. Ten cent is worth fifty times that and paid 8.6 for the 180-person mobile dev SuperCell.

Duane_Does_not_check_email
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Duane_Does_not_check_email

feels like a good time to throw another product under the bus

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Sally Bowls

GW2 is too valuable to throw under the bus. The analogy from business is milking the cash cow

Cash Cow – a business unit that has a large market share in a mature, slow growing industry. Cash cows require little investment and generate cash that can be used to invest in other business units.

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Bhima Jenkins

And here you have it folks, the absolute reason why so many new games are moving to casino-style cash shops to exploit our flawed psychology, because it pays. GW2, whether you like the game or not gives IMMENSE value to the player. It is probably the best bang-for-buck MMO in the market right now, by a great margin. Of course, the problem with that is, its sales numbers won’t ever look that spectacular, because once you buy the box, you have no need to buy anything in the cash shop. Compound that with a cash shop that offers very little in terms of interesting things to buy, and you have these numbers.

The moral of the story is clearly, design more gates in your content to push to buy RNG-based lockbox crap if you want your sales numbers to look good. I hope this trend dies a horrible, fiery death, but its the reality right now.

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Sally Bowls

Except NCSoft announced a while ago that most of GW2’s revenue comes from the cash shop. GW2, like most other MMOs, can’t exist without a vibrant cash shop.

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rafterman

Sally is right, GW2 lives off of it’s cash shop, just like every other F2P game. People buy outfits, bag slots, bank slots, harvesting tools, BL keys, etc. all the time from their store. I don’t know if you just haven’t been paying attention, but there are plenty of things on GW2’s cash shop that people want to buy, it’s really no different than any other F2P game in that regard.

In truth, the “absolute” reason why GW2 is in decline has nothing to do with its poor cash shop or no monthly fee, it’s because the game hasn’t been all that interesting for quite a while, and HoT was an absolute clusterfuck for all but the most diehard fans of the game.

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Greaterdivinity

Its sales numbers were great during vanilla, your post is inaccurate. GW2’s revenue problems have more to due with HoT’s very “meh” reception, followed by issues with supporting the game post-launch and a lack of compelling store content.

The cash shop lacking compelling purchases has been an issue for years, but it’s just hitting harder now that they’ve got a smaller and smaller playerbase that’s playing and spending money less frequently with this new release schedule.

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kgptzac

It’s here folks. Here’s the solid proof that NCSoft could use to justify pouring all resources creating new mobile games, and you can’t refute the hard numbers with the nonsensical “mobile games are saturated” bullshit :D

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Sally Bowls

They haven’t needed justification in quite some time. Back in 2015, NCSoft said in an earnings conference call they were reducing PC devs to be able to focus more on mobile.

From Forbes “NCSoft Goes West: How The Korean Video Game Giant Is Translating Success”

In May 2015, Yoon launched Iron Tiger Studios, a new mobile-gaming division, based in San Mateo, California. NCSoft had only dabbled in mobile games before. The company’s main products were games that were huge, complex and expensive to make, a far cry from the small and inexpensive games that dominate the mobile market.

It’s a risky strategy. Plenty of game companies in the U.S. have tried and failed to translate their products to the mobile market. But mobile is also an “untapped frontier with fewer built-in biases,” says Michael Pachter, managing director of equity research at Wedbush Securities. “I think that some of their properties will work better in the West on mobile.”

Americans also like being heroes, she says, and are more likely to play solo.

Lineage M launched in June and its sales for the day of July 1 were US$11.3M which is nearly GW2’s quarterly revenue.

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Dystopiq

So GW2 made $12,023,161.02 in Q2 17. That’s not too bad.

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Dug From The Earth

Compared to my salary, yeah, not too bad at all. Its actually freaking amazing :P

Compared to past years, and compared to other games though, its actually something to be concerned about.

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kgptzac

It’s the 2nd newest game on that chart and makes the 2nd lowest sales among all their games. I consider it disappointing.

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Dystopiq

It only operates in 3 regions. Compared to other to games which operate in more.

kalamari_
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kalamari_

lol. its the only western based mmo from NCsoft (dont speaking about W*), all the others are asian based mmos and the mmo market in asia is WAY bigger than in the west.

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Greaterdivinity

I believe they’re roughly to half of what they were making during their yearlong content drought before HoT.

To put that number in context.

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Arktouros

I quit playing GW2 because I got tired of constantly having my character rebalanced and messed with for game modes I don’t even play. No one is going to enjoy feeling weaker because their character is considered OP in some other game mode. More importantly OP compared to what? There’s no fractal/dungeon/raid leaderboards. Who honestly cares if characters feel and are strong? Whole situation just became frustrating and I don’t have time for frustration.

We’ll see how they handle this expansion and what they’re about. I like the shift back to living story we saw last year and this one. I like some of the expansion of the WvW systems. Just not quite convinced they’re done mucking with balance but so far the seemingly strong new specializations look promising.

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Greaterdivinity

I still have no clue why they don’t split abilities into PvE/PvP functionality. Didn’t they do that in GW1? Didn’t GW2 initially do that? >.>

I must have totally missed when this changed, but it just makes no sense whatsoever to me that a game that’s “supposed” to treat both halves (PvP and PvE) of the game equally isn’t giving the devs the tools to tune them without potentially screwing players who play the other side of things.

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TomTurtle

Oh god, PvE/PvP skill balance is such a frustration in MMOs. It’s kind of even more of a headache in GW2 since technically it’s PvE/WvW/sPvP skill balance.

From what we’ve heard from the developers, they will only tune numbers per gamemode but they want to avoid changing skill functionality enough so that it’d behave too differently. ArenaNet has improved on splitting the balance as of late at the very least so there’s some good there.

Supposedly we’re getting the big pre-expansion balance patch tomorrow so we’ll see what that brings.

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Greaterdivinity

Yeah, I get not wanting to change how abilities function, but base damage/modifiers etc. should all be easy nobs to turn in the respective modes, same goes for certain stats etc.

Curious to see what the balance patch brings, I still need to play through the last two episodes of this chapter of living story, so maybe it will be a good test for the changes.

Siphaed
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Siphaed
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Arktouros

They 100% did in GW1 and it (along with EverQuest 2) were some of my favorite PvP games for it because PvP was balanced for PvP and PvE was balanced for PvE.

For GW2 there was the mission statement early on that they wanted a character to always feel the same regardless of game mode you go play. So if the effect of skill X in SPvP was 3 seconds long then you can rely on it lasting 3 seconds in all game modes. Even then, there was always some level of split among various game modes such as many Elementalist heals were reduced (repeatedly) in SPvP compared to other game modes.

The problem with class balance now in GW2 is there’s multiple levels of PvE. Raid Balance. Fractal Balance. Open world Balance. So while they hack away at balancing characters for raiding, you get weaker in environments like Fractals or Open world content. The argument then usually tends to go that this is unimportant but since they also don’t separate WvW and PvE most of the time any changes there in also end up affecting the other.

So as much as they’ve said they will start doing these things better, there’s still a lot to untangle with the current mess of a system they have.

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Bryan Turner

They have started splitting skills between game modes to help prevent that from happening. So other than an arbitrary Leaders Board for measurement comparisons (which WoW doesn’t even have) what’s holding you back now that your concerns are no longer relevant?

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Arktouros

You’re like literally everything wrong wrapped up in a comment package.

First of all, they’re splitting the skills between game modes like SPvP and WvW but not subdividing game modes like PvE such as Fractals/Raids. So when my class gets nerfed because it’s “over performing” in a raid environment nothing is going to be different.

Second of all, my entire point was that there isn’t some sort of leaderboard not some sort of arbitrary request for one. If there’s no leaderboard, then there’s no competition. If there’s no competition, then what does over performing even mean in an environment where there’s no competition?

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draugris

There are only Skill Splits between SPvP and PvE, and only on some Skills. WvW is considered PvE by Arenanet and one of the reasons why almost any competitive WvW Players / Guilds left.