NCSoft's Q1 Financials: Everything's Down, But That's OK, Right?

Jason Winter
By Jason Winter, News Editor May 13, 2015
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Lineage 2

Having looked through a bunch of financial reports lately, I'm amused by how, no matter how bad a quarter might look, the language will always be positive. There's always a perfectly valid reason why the numbers are down, but don't worry! They'll be better soon, trust us! In the case of NCSoft's latest report for the first quarter of 2015, I'm actually willing to believe it.

If you compare Q1 2015 to Q1 2014, total sales for all NCSoft products are down 20%, while operating profit is down a staggering 49%. The report explains this away by saying

Sales and operating profit declined from a high base created in 4Q due to year-end promotions. However, both sales and operating profit are expected to rebound in 2H as momentum is created from new online and mobile game launches.

The "post-holiday blues" reasoning might have some merit, since year-over-year numbers -- comparing Q1 2015 to Q1 2014 -- are virtually the same across all counting methods. So maybe it really is just a cyclical, yearly thing.

NCSoft Sales

Really, much of the damage comes from Lineage's slide. Sales for the game had been growing by leaps and bounds for the past year but dropped back to Earth in Q1, losing about 1/3 of its sales, going from about 96 billion Korean won to 66 billion KRW. Lineage II also dropped significantly, from 19.4 billion to 11 billion. Meanwhile, Aion, Blade & Soul, and Guild Wars 2 held mostly steady.

And WildStar? Down another 50% in sales, from 5.5 billion KRW to 2.6 KRW. That F2P/B2P transition can't come soon enough, even if some folks don't want to talk about it.

As is the case with most "down" financial reports, the overall tone of the document is one of optimism for the future and pointing out the positives. Hey, expenses are down! Blade & Soul is big in Taiwan! That Guild Wars 2 expansion sure looks swell! NCSoft has weathered worse dry spells before, so the company's probably OK with a slightly down quarter. After all, companies that are in financial trouble don't do stuff like this:

Labor costs increased in 1Q, due to a special one-off bonus paid to all employees.

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About the Author

Jason Winter
Jason Winter, News Editor
Jason Winter is a veteran gaming journalist, he brings a wide range of experience to MMOBomb, including two years with Beckett Media where he served as the editor of the leading gaming magazine Massive Online Gamer. He has also written professionally for several gaming websites.

Discussion (12)

Viewerx 6 years ago
The reason NCsoft's numbers have fallen substantially in Lineage II is due to mass exploits and bot programs running the server. The game is essentially dead with a few live players and 1,000's of bot programs used by players and 3rd party companies to sell the games currency.

It's a dreadful experience and nearly unplayable. Ncsoft is also shameless at their cash shop practices. (In contrast to excellent models like Path Of Exile)

Buggy 6 years ago
GAme market stock crash needs more innovation

View 1 reply
bizzie 6 years ago
When they give us a USA Blade & Soul server they willgetheir money >=T

View 1 reply
Eviil 6 years ago
Kay, Q2 2014 was when wildstar was released, that's gravy, but its 1 year anniversary is near and not much profit. they better convery to f2p but hey, billions of dollars, why not.

View 1 reply
Kek 6 years ago
Want money? Release blade and soul on the West. Otakus and cosmetic freaks will go ape shit on customs and alike. AmIwrong?

View 4 replies

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