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Perfect World enjoys a profitable 2013
Perfect World Entertainment is celebrating this week as the most recent financial reports show a revenue increase of 11% for last year, thanks to forward-thinking initiatives aimed at investments in other companies and a focus on mobile gaming for the future. Most impressive was the Q4 results showing a net profit growth from RMB86.4 million to RMB209.8 million ($34 million), according to a report at Gamesindustry.biz. All of this, of course, is on the heels of DotA 2's upcoming release in China and Neverwinter's Chinese release later this year which both may play a part in even further growth for 2014.
Funcom's financials take a sharp blow
The earnings report for Funcom's fourth quarter 2013 is in -- and it doesn't look pretty. The studio reported that revenues are down both year over year and quarter over quarter due to deferred billings with The Secret World and increased competition. However, Funcom said that a better business model and new marketing programs are resulting in a stronger first quarter for 2014 and that its MMOs are "cash-flow positive and will remain so in the foreseeable future." Funcom said that it is taking steps to turn around the business with a new strategy to focus on more mid-core online games with smaller budgets and shorter development time. It's also continuing to invest in LEGO Minifigures Online and the Dreamworld technology. The latter is important so that the studio can release games across multiple platforms including Android and iOS tablets. LEGO Minifigures Online is scheduled for open beta testing this summer. The Økokrim charges regarding possible market manipulation between August 2011 and August 2012 were mentioned. Funcom said that no employees have been charged, and the company is cooperating fully with the ongoing investigation.
Report: 0.15% of mobile gamers account for 50% of F2P game revenue
A recent survey conducted by app marketing firm Swrve found that 50 percent of all free-to-play mobile game revenue comes from only 0.15 percent of players. The survey, reported by VentureBeat, finds that big-spending players, or "whales," often determine a free-to-play game's financial success. Swrve's survey additionally found that the vast majority of its 10 million tracked players never spent any money whatsoever on free-to-play mobile games. Speaking to VentureBeat, Swrve CEO Hugh Reynolds broke down the survey's results, explaining that only 1.5 percent of surveyed players made a purchase within a free-to-play game in the month of January. Around 50 percent of recorded revenue came from the top ten percent of players who did make purchases, representing 0.15 percent of the survey's total headcount. Reynolds also warns that traditional in-app purchase marketing methods are proving less effective in the current marketplace climate. "People are very mobile, and they have a lot of options," Reynolds told VentureBeat. "Trying to capture them is becoming more and more difficult." [Image: Swrve]
Ubisoft sees 35% drop in sales
Ubisoft reported 520 million euros ($709.5 million) in sales for the third quarter of the 2013 - 2014 fiscal year, which ended December 31, 2013. The sales represent a 35.2 percent drop year-over-year. Ubisoft reported total sales of 813 million euros ($1.1 billion) for the first nine months of the fiscal year, a 24.8 percent decrease compared to the nine-month-period earnings one year prior. Additionally, it reported a 4 percent decrease year-over-year in digital sales, which amounted to 53 million euros ($72.3 million). Ubisoft cited the "console transition period" among the reasons for the company's losses in the quarter, pointing to back-catalog sales of 53 million euros ($72.3 million), a 21 percent contraction. The publisher also saw "lower-than-expected sales" for Rocksmith 2014, but said it shipped 10 million units of Assassin's Creed 4: Black Flag. All in all, it expects approximately 1,000 million euros ($1.36 billion) in sales for the full fiscal year 2013 - 2014. [Image: Ubisoft]
Destiny to be 'best-selling new IP in history' according to Activision [update]
Activision is dreaming big for Bungie's Destiny, dubbing it the "next billion dollar franchise." Activision CEO Bobby Kotick echoed the projection, telling investors during today's earnings call that the publisher expects "Destiny will become the best-selling new video game IP in history." Destiny, an online, loot-heavy first-person shooter, is due on September 9. No pressure. Activision also reported $4.58 billion in revenue for the 2013 calendar year. The earnings represent a 5.76 percent decrease compared to that of 2012, in which the publisher earned $4.86 billion. It also reported fourth quarter earnings of $1.52 billion, a nearly 120 percent leap from its $691 million in revenue during the third quarter and well above its $1.26 billion projection. Finally, World of Warcraft had 7.8 million subscribers as of December 31, 2013, an increase from the 7.6 million reported during the last quarter. Update: As it turns out, Kotick's direct quote from the earnings statement is that Activision expects "Destiny will become the best-selling new video game IP in history," which is substantially different than being the best-selling game overall. We've updated the quote and headline accordingly. We apologize for the error. [Image: Activision]
What can you buy with Apple's Q1 profit?
In Apple's Q1 earnings report, the company reported a profit of $13.1 billion. That's a whole lot of money, but it can sometimes be difficult to really wrap your head around a figure that large. So to help put it in perspective, here are a few things you could buy with that much money. Note: These are prices as they were originally introduced
EA reports $308 million loss in Q3 2014
Electronic Arts reported a net loss of $308 million in the fiscal third quarter of 2014, a period of three months stretching from October 1, 2013 through the end of December. The company reported a net revenue of $808 million, which compares unfavorably to the $922 million reported during the same quarter last year. It is a 16.3 percent increase from last quarter's reported $695 million earnings, however. EA reported that 50.7 percent ($410 million) of its earnings came from digital sales, calling out a 60 percent increase in FIFA Ultimate Team, Madden NFL Ultimate Team and NHL Ultimate Team sales on a non-GAAP basis (Generally Accepted Accounting Principles). It reported a trailing twelve-month total revenue of $3.66 billion, and projects its revenue for fiscal 2014 (the year ending March 31) to be $3.52 billion, $1.07 billion of which is expected to come in the next quarter.
App Store sold more than $10 billion in 2013
If you spent any money on the App Store in 2013, you helped contribute to a record-breaking year for Apple's digital marketplace. The company revealed today that App Store sales passed US$10 billion in 2013, with more than $1 billion in sales coming in December alone. Apple's press release calls out a few apps by name for their surprising performance, including Heads Up, Candy Crush Saga, QuizUp and Minecraft. The company also notes that, to date, it has paid out a whopping $15 billion to app developers who stock the virtual store shelves.
Perfect World ends the quarter strong, looks to Dota 2's China release
Perfect World Entertainment, the China-based publisher behind games like Perfect World International, Neverwinter, Star Trek Online, and Champions Online, ended the last financial quarter in a strong place. Citing the Chinese release of Swordsman Online and Saint Seiya Online as driving factors, Perfect World claimed $136.2 million in revenue and $19.8 million in net profit -- up from last year's marks of $114.2 million and $14.2 million respectively. Perfect World also expressed its hope for even better quarters to come thanks to big launches in the pipeline. It is currently localizing Neverwinter for a Chinese release and will be overseeing Valve's Dota 2 as it makes its way into Chinese markets.
World of Warcraft sheds another 100,000 subscriptions
Everyone is pretty certain that the next World of Warcraft expansion is going to be announced very soon. Tomorrow, probably. So it serves as an interesting counterpoint to note that the game has lost 100,000 subscribers over the past three months, dropping the game's total to 7.6 million subscribers and serving as a rather inelegant coda to the game's most recent expansion, Mists of Pandaria. Activision Blizzard CEO Bobby Kotick stated the numbers during a post-earnings call while noting that "new and exciting content" is on the way for the game. While 7.6 million subscribers is still more than enough to make hats out of money, it's a far cry from the game's subscription height. It remains to be seen whether or not the next expansion will help launch the game back upward or not -- and whether the game is currently undergoing a slump or is simply beginning to decline.
Apple's per-employee revenue is 'off the charts'
If there's one thing Apple is not in need of, it's cash in its bank account. It's hardly a secret Apple is a moneymaking machine, enjoying margins that other hardware manufacturers can only dream of. During Apple's most recent quarter, the company posted revenue of US$37.5 billion, marking a new Q4 record in the process. When you begin breaking down Apple's staggering quarterly revenue across various metrics, a lot of fun and interesting factoids emerge. For instance, Apple during the last quarter generated $13 million in revenue every single hour. ISI's Brian Marshall also did some Apple revenue math and deduced that Apple's revenue per employee is a whopping $2.13 million. Note that the breakdown only includes full-time-equivalent employees.
Nikon hurt by falling DSLR prices, but still faring better than Canon
Nikon's finance department has been forced to revise its quarterly revenue forecast in a southerly direction due to the fact that entry-level DSLRs are selling for lower prices than it originally expected. One of the culprits is likely to be the D3200 shown above, which is currently going on Amazon for around $550 with a kit lens, or $150 below its list price. Looking to the future, the company also warns that sales of its Nikon 1 interchangeable lens cameras may shrink in 2014 due to "weak market conditions," despite the splash made by its recent ruggedized ILC, the Nikon AW1. The news isn't all bad, mind you, as the anticipated drops only add up to a few percentage points and Nikon says it's on course to make the same net profit it had previously projected -- a mostly stable outlook that struggling rival Canon can only dream of.
EA reports $273 million loss in second quarter of fiscal 2014
EA released its financial report for the second quarter of fiscal 2014, a period of time that stretched from July 2013 through the end of September, reporting a net loss of $273 million during that time. The publisher saw a two percent decline in net revenue compared to the same three-month time frame last year, as total revenue reported by EA in the last quarter was $695 million. This was a 26.8 percent decrease from the first quarter and was 11.2 percent above the company's projections for the second quarter. The company noted its decision to exclude its $40 million college football lawsuit settlement from its non-GAAP (Generally Accepted Accounting Principles) financial measures and when "evaluating its operating performance and the performance of its management team during this period and will continue to do so when it plans, forecasts and analyzes future periods." The settlement was first announced in late September, at which point the publisher canceled the 2014 college football game that was no longer bearing the NCAA name. EA is projecting $775 million in net revenue for the third quarter, which ends December 31.
Microsoft Q1 2014 financials show 16 percent increase in revenue
Microsoft revealed its first quarter 2014 financial results (the period of July 2013 through September 2013), primarily showing growth in revenue and net income. The company brought in $18.53 billion in revenue in the quarter, a 16 percent increase from its reported revenue from Q1 2013 report one year ago, $16.01 billion. This is also a 6.88 percent decline from its $19.9 billion revenue reported in the last quarter. Microsoft also reported $6.33 billion in net income, a 19 percent increase from last year. The earnings report noted a deferral of $113 million of revenue from Windows 8.1 pre-sales as well as a four percent growth in devices and consumer revenue to $7.46 billion.
App Store's revenue grew 15% between February and July
The analytics wizards at Distimo have released their July report on mobile trends, this time comparing the top apps for the App Store, Google Play and Amazon's Appstore for Android. Tucked away in their findings, however, is an interesting look at how Apple's App Store for iOS has grown in the last six months. Between February and July of 2013 the App Store grew by 15 percent while Google Play saw its own store grow by 67 percent. While the discrepancy between each store's growth rate may seem unfavorable for Apple, it's important to point out the App Store still generated more than twice as much revenue as Google Play during that same period. (It's easier to grow by big percentages from a smaller base, in other words.) The app that generated the most revenue globally, Candy Crush Saga, was the same for each company, meaning that regardless of what kind of smartphone your friends are working with, you're probably being asked for candy assistance on Facebook at this given moment. Interestingly, none of the normally paid apps that were offered for free as part of Apple's App Store 5th Anniversary sale made it into July's top five free paid apps. BADLAND came close, but was unable to move past number six on the charts. The next closest anniversary sale title to chart in the Top 10 was Infinity Blade II, at number nine. Worldwide, the United States spends the most money on apps, followed by Japan and South Korea, which account for a majority of the growth Google Play's store enjoyed during the six-month period.
Microsoft filing shows just $853 million in Surface revenue following $900 million RT inventory charge
Ballmer and Co. have been tight lipped when it comes to Surface sales figures, but they've just opened up a little to Uncle Sam. An SEC filing reveals that the first-party tablet raked in a total of $853 million in revenue between its debut and June 30th, the end of the firm's fiscal year. To put that in perspective, the cash Microsoft managed to pull in is eclipsed by a $900 million hit it took through Surface RT inventory adjustments. To make matters worse, the company spent more on advertising for Windows 8 and Surface ($898 million), than its tablet brought in. Though details on how many slates have shipped or sold are still MIA, price drops make us suspect that those numbers are still too modest for Redmond's taste.
Xiaomi announces $2.16 billion revenue in 1H 2013, beating the entire 2012
In a Chinese press release we just received, phone maker Xiaomi has just announced that it generated a revenue of CN¥13.27 billion or about $2.16 billion in the first half of 2013. This easily exceeds the company's CN¥12.6 billion or $2.05 billion revenue from the entirety of 2012, so things are already looking good ahead of the annual event on August 16th, when multiple products are expected to be launched -- including a TV that got leaked last month. CEO Lei Jun said that this is partly thanks to the 7.03 million Xiaomi Phones his company sold within the same period, and the release also praised the popularity of the Xiaomi Box plus various other accessories, such as the new in-ear headphones launched recently. In addition to that, Xiaomi now has 20 million users from around the world as of end of June, 14.22 million of which come from mainland China, Hong Kong and Taiwan. The latter two became part of Xiaomi's larger scope in April this year, with Hong Kong using the classic online retail model, and Taiwan doing the same but also selling devices through a partnership with local carrier Far Eastone. Despite the surprising good announcements, Lei reminds his team at today's celebration party to "forget about the results, they're not the most important," and that "only making products that make users scream can bring in long-term value." The real challenge now is to tap into the more exotic markets, and Xiaomi has previously expressed great interest in Europe. Good luck with that, Lei!
Pay-to-trade could change the landscape of MMO economies
If you've noticed that it's become more difficult to buy, sell, or trade goods in an MMO these days due to the sheer amount of player-bound items, you're not imagining things. A writer for Gamasutra penned an article in which he discusses the decrease of in-game trade and suggests that studios might be missing out on a great source of potential revenue. First, he acknowledges why studios have moved to restrict trade. It keeps the headache of managing an economy to a bearable amount, it cuts out duping and exploits, and it stems revenue losses that are caused by third-party traders. However, the author says that the hassle could be worth it if studios were smart and got in on the action by creating a pay-to-trade economy. "In the real world, we pay huge sums in the form of taxes and fees to keep transaction costs low," he writes. "So here's my question for developers: How much would your players pay you in exchange for the ability to trade?"
Lenovo pulls in best-ever revenue of $7.8 billion for Q4 2012/13, record $34 billion for the year
Lenovo's just announced its Q4 and full year 2012/13 financial results, and it's touched new highs on the two most important indices. It earned $127 million on $7.8 billion in revenue for the quarter and $34 billion for the full year, both records for the company, while netting $635 million in profit for the full year -- another all-time high. The only sore spot for Q4 was Lenovo's laptop business, which dropped two percent over last year to $4.2 billion, but that's a far milder plummet than many PC makers saw -- thanks to a 74 percent revenue growth in China. Otherwise, desktop PCs held flat for the company at $2.4 billion during an otherwise down period, and it held firm as China's number two smartphone manufacturer, seeing shipments grow at 206 percent year-over-year, double the average rate. It remains to be seen if Lenovo can continue to buck the downward PC trend that's continued unabated with the release of Windows 8 -- but if not, maybe we'd finally see some of its smartphones over here.
Free-to-play model more than doubled the revenue of Star Wars: The Old Republic
Following the free-to-play announcement, many gamers were quick to mark Star Wars: The Old Republic as a broken shell of a game, with its business model conversion serving as the last gasp of a game in danger of imminent shutdown. The facts do not support that particular viewpoint. According to the most recent Electronic Arts earning call, the game has more than doubled its revenue since the conversion in November of last year. EA president Frank Gibeau stated in the most recent earnings call that the game's subscriber numbers have remained stable, with more than 1.7 million new players joining the game via the free option. He also restated that the game is aiming to keep up a content delivery schedule around every six weeks. So if you were getting a bit nervous about the long-term viability of SWTOR, it looks like you can rest a bit more easily.
