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NCsoft Profits Down In Second Quarter

NCsoft Profits Down In Second Quarter

August 13, 2008 | By David Jenkins

August 13, 2008 | By David Jenkins

Despite a small revenue increase, NCsoft's profits fell 42 percent in its second fiscal quarter due to a lack of new products in the last few months and higher advertising and outsourcing costs, the South Korean MMO publisher says.

NCsoft's net sales increased by 7 percent on the previous year to 81.2 billion won ($78.1m), although this was 8 percent less than the last quarter. The publisher netted 6.1 billion won ($5.9m), in income, down 42 percent on the previous year.

Results suffer for the absence of any new Guild Wars launches or royalties from Chinese publisher The9, NCsoft says, in addition to the cost of relocating the companys headquarters, higher advertising costs and outsourced R&D costs were also factors.

However, cracking down on pirate Lineage servers and offering new content updates on Lineage II helped give the company its small bump in year-over-year sales.

By region, sales in South Korea accounted for 58 percent of the companys business, with North America and Japan both with 13 percent, Europe with 6 percent and Taiwan with 4 percent. Royalties from external publishers stood at 6 percent of sales income.

"In order to maintain our ongoing development cycles and a diverse game portfolio, multiple games are in development currently across all NCsoft studios, said NCsoft CFO Jaeho Lee.

The companys next major release is Aion, which has just finished a third stage of closed beta testing.

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