GW2 Sales/Revenue/Earnings Report 1Q-2023

[Zok.4956]

Overview of GW2 Earnings from 3Q-2012 (release) until 1Q-2023 (latest official report) with annotations:
https://cdn.discordapp.com/attachments/685436537827098645/1132272915631587439/gw2-sales-2012q3-2023q1.png

2Q-2022 (the quarter after the release of EoD) recorded the highest revenue at KRW 27.2 billion, since then the revenue steadily declined about KRW 2 billion every quarter to KRW 20.4 billion in 1Q- 2023. This drop in sales after a release is not uncommon and can also be observed after HoT and PoF, although there the drops were significantly larger (in percentage terms).

The Steam release was probably not a (big) financial success as there is no visible sales spike from the Steam release. But perhaps the revenue from the Steam release helped a little to ensure that the drop in sales in the first quarters after EoD was not as large as with previous expansions. However: Sales are now shrinking for 4 consecutive quarters and the steam release has not stopped the downtrend and this downtrend must be stopped soon in the next few quarters.

As I said before, if the game can keep its quarterly sales around KRW 20 billion, it probably has a long future for several years. But the game is now more than 10 years old and doesn't have much revenue growth potential anymore because the studio doesn't seem able to grow the revenue past KRW 30 billion anymore. Maybe that's a reason why Anet/NCSoft made the decision to release smaller extensions more often to stabilize sales.

As the new SotO expansion is released in a few weeks, it will be interesting to see if this will stop the downtrend and how big the quarterly revenue peak from SotO sales will be.

P.S. As always, I took the numbers from the official NCsoft reports at https://kr.ncsoft.com/en/ir/irArchive/earningsRelease.do

[Zok.4956]

And here are some previous earnings reports:

 

 

 

[Jin.8501]

Pretty weak show tbf. Cheaper to focus on weekly skins with that performance.

Shame really since the game is a hidden gem apart from the weak instanced content which has been ruined with boon powercreep

[bruakumfd.4817]

It's cool that you found actual numbers. You should keep in mind though it follows the same model on the official website, aside from gem cards not working. So, it wouldn't make any sense for there to be a huge jump in sales. 

Also, I don't know if you read the news articles in the launcher. However, they've already explained why they're changing up how content gets released. And no, it wasn't for sales reasons. 

[Zok.4956]

24 minutes ago, bruakumfd.4817 said:

they've already explained why they're changing up how content gets released. And no, it wasn't for sales reasons. 

I know what they wrote. That is certainly true, but certainly not the whole truth. Practically all major decisions in a company also revolve around making money, which is completely normal.

No company would publicly write (just as an example): "In the future we will make smaller expansions at shorter intervals (and no new "free" living world content anymore) because we hope to be able to charge more money for expansions with the same developer ressources and thus earn more money than before".

[Killthehealersffs.8940]

19 minutes ago, Zok.4956 said:

 (and no new "free" living world content anymore) because we hope to be able to charge more money for expansions with the same developer ressources and thus earn more money than before".

Yeah , i would prefer forcing each newcomer to pay the expasnion + buy the episodes for 100 euros just like EoD did , rather than 5 years from now , all expasnions will be in a 50 dollar packages  for them  /s 😛

You know if this model doesn't work we can alwaways go back the the FULL-OPEN world model and sedomly offer some instances sprinked in them

Edited July 22, 2023 by Killthehealersffs.8940

[Zok.4956]

25 minutes ago, Killthehealersffs.8940 said:

Yeah , i would prefer forcing each newcomer to pay the expasnion + buy the episodes for 100 euros just like EoD did , rather than 5 years from now , all expasnions will be in a 50 dollar packages  for them  /s 😛

When Anet presented the microtransactions for living world back then, I was already aware that this would become problematic for new players in later years.

That's why I think it's basically right if Living World is always considered part of the expansion in future expansions. The only thing I'm not sure about is whether the quantity and quality will be sufficient.

P.S. At Steam release, Anet should have offered S3 as part of HoT and S4 as part of PoF (and S2 should have been free). Anet would probably have made significantly more revenue overall (because more units would have been sold) if the complete package had been offered at a significantly lower price.

 

[Khisanth.2948]

Are these numbers adjusted for inflation and exchange rate?

[Ashen.2907]

50 minutes ago, Khisanth.2948 said:

Are these numbers adjusted for inflation and exchange rate?

I don't think that financial reports of this sort are adjusted for inflation because they are reporting current results. As to exchange rate, they generally report in their native currency.

Edited July 22, 2023 by Ashen.2907

[Khisanth.2948]

9 minutes ago, Ashen.2907 said:

I don't think that financial reports of this sort are adjusted for inflation because they are reporting current results. As to exchange rate, they generally report in their native currency.

I am referring to the chart OP made. The earnings reports are only reporting on the current situation for the company but OP is attempting to use that data to make comparisons and draw conclusions.

Making comparisons without accounting for those sorts of factors is about as useful as comparing your DPS at launch with now without accounting things like balance changes and new stat combos.

[Ashen.2907]

Just now, Khisanth.2948 said:

I am referring to the chart OP made. The earnings reports are only reporting on the current situation for the company but OP is attempting to use that data to make comparisons and draw conclusions.

Making comparisons without accounting for those sorts of factors is about as useful as comparing your DPS at launch with now without accounting things like balance changes and new stat combos.

I see.

[IAmNotMatthew.1058]

2 hours ago, Killthehealersffs.8940 said:

Yeah , i would prefer forcing each newcomer to pay the expasnion + buy the episodes for 100 euros just like EoD did , rather than 5 years from now , all expasnions will be in a 50 dollar packages  for them  /s 😛

You know if this model doesn't work we can alwaways go back the the FULL-OPEN world model and sedomly offer some instances sprinked in them

And this is still a friendlier approach than having to pay each month + buy the new expansion.

[Zok.4956]

2 hours ago, Khisanth.2948 said:

Are these numbers adjusted for inflation and exchange rate?

No. As I already wrote those are the real and unchanged financial numbers from NCsofts official earnings reports in KRW. I would like to have more detailed numbers from different markets (NA, EU, etc) in local currency from GW2, but NCsoft is not reporting those.

 

1 hour ago, Khisanth.2948 said:

OP is attempting to use that data to make comparisons and draw conclusions.

Naturally. Of course, inflation and exchange rates distort the figures more and more the further back you look, depending on what you want to compare. But the basic trends and patterns of the quarterly sales remain visible despite these distortions if they are clear enough. To look at overall quarterly sales patterns and trends, and to see if some recent events I've written about are having an impact, it doesn't matter how inflation and exchange rates have changed over the past 10 years in the various markets where the game is sold.

 

1 hour ago, Khisanth.2948 said:

Making comparisons without accounting for those sorts of factors is about as useful as comparing your DPS at launch with now without accounting things like balance changes and new stat combos.

It all depends what you want to say with your DPS comparison. Comparing your DPS at launch with the DPS now could be a valid comparison if you want to talk about power creep. However, if you're arguing that your 37.456% DPS increase since release is because you're now playing 37.456% better, that's obviously an invalid and incorrect comparison.

 

[Funky.4861]

If only anet didn't make unpopular changes to things which were working perfectly fine, they might retain and acquire more players.

[Noah Salazar.5430]

i think thay schold charge more for dlc, but put more effor into it, we don't want acidents like secound meta of Gyale Delve to happyn, wher thay put 3 same events in row, map looked 10/10, but events/reward suck, cuz thay undercook it

 

i personaly prefer to pay twice as much, but got delivered drizwood map quality

Edited July 23, 2023 by Noah Salazar.5430

[Vayne.8563]

Maybe I'm reading that graph wrong, but year on year it looks like we're about even, maybe even a little ahead, but it's hard to tell.  It's not about a raw number so much as stability. Different things happen in different quarters, and that's how most companies look at business. What they did year on year.

When I worked on electronics, we had a goal each month to beat, not the month before, but the same month of the year before. Seems like year on year, we haven't gone down. If someone can check that and tell me if it's right, that would be cool, because I could have screwed up how I read it.

[Adry.7512]

No, they made the decision to change the business plan. The business plan was not good and extremely outdated compared to basically all modern mmos. They created a system that would increase revenue on a more consistent basis. 

[Krajtin.8956]

We'll see if the SoTo revenue works out and ncsoft doesn't crack down

Edited July 23, 2023 by Krajtin.8956

[particlepinata.9865]

More or less the same revenue compared to earlier years actually is not so good. There has been alot of inflation (the last 3 and a half years especially),money is worth alot less compared to 2019 and before. Something that always seem to be forgotten with comparisons. Just like movie box office comparisons are unfair, and the box office record lists are nonsense without inflation correction over the years.

Edited July 23, 2023 by particlepinata.9865

[Zok.4956]

6 hours ago, Vayne.8563 said:

Maybe I'm reading that graph wrong, but year on year it looks like we're about even, maybe even a little ahead, but it's hard to tell.  It's not about a raw number so much as stability. Different things happen in different quarters, and that's how most companies look at business. What they did year on year.

When I worked on electronics, we had a goal each month to beat, not the month before, but the same month of the year before. Seems like year on year, we haven't gone down. If someone can check that and tell me if it's right, that would be cool, because I could have screwed up how I read it.

In many companies there is a seasonal revenue component. For some, December sales account for 50% to even almost 70% of annual sales. That is why year-to-year quarterly comparisons are often made. Looking at the chart above, I can't consistently see such a seasonal variation in GW2.  But I see that other things (e.g. release of an expansion) have a much bigger impact on sales. Therefore, I found the graphic above to be the most informative for me. 

I have now made a quick graph of the annual sales totals (2012 is only a half year because the release of GW2 was in 2nd half). Again, we can see that 2022 was a good year in terms of sales, with 2019 and 2020 (the mass layoffs were in the beginning of 2019 and IBS was announced and started in 2019) being the worst years in the history of the game:
https://cdn.discordapp.com/attachments/685436537827098645/1132659756528570409/gw2-yearly-revenue-2012-2022.png

As I said before (with quarterly numbers), if the game can keep it's yearly sales around or above KRW 80 billion, it probably has a long future for several years.

[Gehenna.3625]

Even if they say they didn't do this for this reason, I think it will help. The amount mentioned of 20.4 billion krw is by far not the lowest it's ever been. It's been down to 13ish billion krw before various times. 

With regular expansion releases they will shorten the time between expansions obviously but that also means that there will be a peak and then it will fall down every quarter for a shorter time. But I think they won't drop (far) below 20 billion krw if they play their cards right. It also could make them less dependent on gemstore sales. So having a smaller range between high quarterly earnings and low quarterly earnings, their income also becomes more reliable. And that makes it easier to plan ahead. We still have Q2 after this but SotO releases in Q3. So yeah it'll be interesting to see whether they can keep the low quarters not go so low anymore.

Edited July 23, 2023 by Gehenna.3625

[Zok.4956]

2 hours ago, Adry.7512 said:

The business plan was not good and extremely outdated compared to basically all modern mmos.

GW2 deliberately did a lot of things differently than virtually all other "modern" MMOs. Different does not automatically mean outdated. Do you know their internal business plan (I don't) and can tell what exactly was outdated about it?

 

2 hours ago, Adry.7512 said:

They created a system that would increase revenue on a more consistent basis. 

Yes, I think so, too.

Edited July 23, 2023 by Zok.4956

[Vayne.8563]

4 hours ago, Zok.4956 said:

In many companies there is a seasonal revenue component. For some, December sales account for 50% to even almost 70% of annual sales. That is why year-to-year quarterly comparisons are often made. Looking at the chart above, I can't consistently see such a seasonal variation in GW2.  But I see that other things (e.g. release of an expansion) have a much bigger impact on sales. Therefore, I found the graphic above to be the most informative for me. 

I have now made a quick graph of the annual sales totals (2012 is only a half year because the release of GW2 was in 2nd half). Again, we can see that 2022 was a good year in terms of sales, with 2019 and 2020 (the mass layoffs were in the beginning of 2019 and IBS was announced and started in 2019) being the worst years in the history of the game:
https://cdn.discordapp.com/attachments/685436537827098645/1132659756528570409/gw2-yearly-revenue-2012-2022.png

As I said before (with quarterly numbers), if the game can keep it's yearly sales around or above KRW 80 billion, it probably has a long future for several years.

There wasn't a seasonal component for sure, but there are reasons for games to do better or worse, including other games coming out at the same time.  For example, a lot of games did better, particularly MMOs, during covid, when so many people were on lockdown. We're strabilizing now in the after covid era,. People are "getting back to normal" whatever that means for gamers. But this game also has March and August sales. They're seasonal. And I know people that come back for specific festivals in my guild (like SAB), and play much harder and buy more stuff because of a festival they completely like and they're around for a while.

The fact that we have repeating sales and events in this game that are scheduled means this game might very well have a seasonal flow to it.  In fact, I can't imagine that not being the case.

[Zok.4956]

5 minutes ago, Vayne.8563 said:

The fact that we have repeating sales and events in this game that are scheduled means this game might very well have a seasonal flow to it.  In fact, I can't imagine that not being the case.

I agree. GW2 has some kind of a seasonal flow. I'm, not saying it does not exist, I just can't see it in the quarterly sales numbers/trends. Can you?

[Vayne.8563]

Just now, Zok.4956 said:

I agree. GW2 has some kind of a seasonal flow. I'm, not saying it does not exist, I just can't see it in the quarterly sales numbers/trends. Can you?

Because it's influenced by other things.  There was an huge artificial bump in pretty much every MMO during covid was the point and things are getting back to a more normal pace.  There are games that come out that affect sales too. Specific games will draw people away for a period of time and then sometimes people come back and sometimes they don't.  It's harder to see the effects in game generally.  I think every MMO is doing it hard except for probably FF XIV and WOW, and that's not all that unsuual. I don't think the the dire straits that are talked about in the OP are realistic.

In businesses there are always expectations and if we don't know what those expectations are, saying we're doing good or bad largely depends on how you like the game. I don't think the game is doing great, but I also don't think the game is doing badly.  I remember a woeful period of time about six months after the HoT expansion launched.  The game was a disaster at the time. It showed to me in my guild numbers and what was going on in game.  There were talks of a content draught.  Hell I even remember a huge mass exodus from the game months after it launched.

This doom and gloom quarter by quarter stuff eventually gets old, considering I've seen the same posts about it doing well or not doing well six years ago.  Shrugs.