DUST Search - CCP drops into red, losing $21m in FY 2013

Fox Gaden wrote:

Agrios Endendros wrote:

Quote:

CCP Has recorded a loss of over $21 million for financial year 2013, a considerable drop from a profit of $4.6 million the previous year. Revenues for the company rose to $76.7 million from $56.3 million.

The predominant, if not only, factor in the sudden profit dip is a massively increased R&D budget, which shot up from $16.5 million in FY 2012 to $56.5 million in FY 2013. Whilst some of those costs are likely to relate to the development of Eve Universe properties Valkyrie, Online and Dust, a significant portion is thought to be attributable to the cancellation of World of Darkness, the Vampire MMO which ceased development earlier this week, resulting in the loss of 56 jobs.

A note in CCP's full financial presentation seems to support the theory that a large factor in this $40 million increase in R&D costs was the removal of asset value previously attributed to World of Darkness.

via GameIndustry.biz

uh-oh. Hope this doesn't hurt too much.

Massive increases in R&D usually means long term profits.

Example:
Blackbarry = Low R&D expenditures.
Apple = High R&D expenditures.

Blackberry was very successful in the short term, but look at them now.

Haruko Endendros AV Com & Logi ~ Canti Endendros Pilot ~ Zero Endendros Scout

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Agrios Endendros Single Serving Friends 170	Posted - 2014.04.15 18:38:00 - [1] - Quote Quote: CCP Has recorded a loss of over $21 million for financial year 2013, a considerable drop from a profit of $4.6 million the previous year. Revenues for the company rose to $76.7 million from $56.3 million. The predominant, if not only, factor in the sudden profit dip is a massively increased R&D budget, which shot up from $16.5 million in FY 2012 to $56.5 million in FY 2013. Whilst some of those costs are likely to relate to the development of Eve Universe properties Valkyrie, Online and Dust, a significant portion is thought to be attributable to the cancellation of World of Darkness, the Vampire MMO which ceased development earlier this week, resulting in the loss of 56 jobs. A note in CCP's full financial presentation seems to support the theory that a large factor in this $40 million increase in R&D costs was the removal of asset value previously attributed to World of Darkness. via GameIndustry.biz uh-oh. Hope this doesn't hurt too much. Agrios Endendros Heavy Haruko Endendros AV Com & Logi ~ Canti Endendros Pilot ~ Zero Endendros Scout
RayRay James Molon Labe. General Tso's Alliance 64	Posted - 2014.04.15 18:39:00 - [2] - Quote Nothing really to worry about, companies run in the red all the time. The death of WoD will be a write off on next years income statements and, voila, back in the green
Iron Wolf Saber Den of Swords 14243	Posted - 2014.04.15 18:41:00 - [3] - Quote You're like a year slow man. CPM 0 Secretary Omni-Soldier, Forum Warrior, Annoying Artist \\= Advanced Caldari Assault // Unlocked
P14GU3 The Southern Legion League of Infamy 558	Posted - 2014.04.15 18:45:00 - [4] - Quote Not sure if it works the same for CCP, but when most companies say they take a "loss," its not that they really lost any money. See companies project to make so much money for the year, say 50 million USD. If they only earn 40m that year, they "lost" 10m. Oil companies purposely project high every year, so instead of showing that they make Billions every year, they can say they lost a few million... Yeah, i run an Amarr logi with a mass driver.. what are YOU going to do about it?
Agrios Endendros Single Serving Friends 170	Posted - 2014.04.15 18:46:00 - [5] - Quote Iron Wolf Saber wrote: You're like a year slow man. Actually the $21 million loss wasn't revealed until the financial report at the end of March, but I saw no posts regarding it here. Agrios Endendros Heavy Haruko Endendros AV Com & Logi ~ Canti Endendros Pilot ~ Zero Endendros Scout
Canari Elphus Dirt Nap Squad. 1432	Posted - 2014.04.15 18:46:00 - [6] - Quote Not quite sure I understand how a decrease in asset valuation would lead to an increase in R&D costs? Canari Elphus for CPM1
Fox Gaden Immortal Guides 2939	Posted - 2014.04.15 18:46:00 - [7] - Quote Agrios Endendros wrote: Quote: CCP Has recorded a loss of over $21 million for financial year 2013, a considerable drop from a profit of $4.6 million the previous year. Revenues for the company rose to $76.7 million from $56.3 million. The predominant, if not only, factor in the sudden profit dip is a massively increased R&D budget, which shot up from $16.5 million in FY 2012 to $56.5 million in FY 2013. Whilst some of those costs are likely to relate to the development of Eve Universe properties Valkyrie, Online and Dust, a significant portion is thought to be attributable to the cancellation of World of Darkness, the Vampire MMO which ceased development earlier this week, resulting in the loss of 56 jobs. A note in CCP's full financial presentation seems to support the theory that a large factor in this $40 million increase in R&D costs was the removal of asset value previously attributed to World of Darkness. via GameIndustry.biz uh-oh. Hope this doesn't hurt too much. Massive increases in R&D usually means long term profits. Example: Blackbarry = Low R&D expenditures. Apple = High R&D expenditures. Blackberry was very successful in the short term, but look at them now. Hand/Eye coordination cannot be taught. For everything else there is the Learning Coalition.
Agrios Endendros Single Serving Friends 170	Posted - 2014.04.15 18:47:00 - [8] - Quote P14GU3 wrote: Not sure if it works the same for CCP, but when most companies say they take a "loss," its not that they really lost any money. See companies project to make so much money for the year, say 50 million USD. If they only earn 40m that year, they "lost" 10m. Oil companies purposely project high every year, so instead of showing that they make Billions every year, they can say they lost a few million... Mainly "in the red" means not profitable and is a bad thing. If there are in the red it means they spent more money than they made. Agrios Endendros Heavy Haruko Endendros AV Com & Logi ~ Canti Endendros Pilot ~ Zero Endendros Scout
Agrios Endendros Single Serving Friends 170	Posted - 2014.04.15 18:49:00 - [9] - Quote Fox Gaden wrote: Agrios Endendros wrote: Quote: CCP Has recorded a loss of over $21 million for financial year 2013, a considerable drop from a profit of $4.6 million the previous year. Revenues for the company rose to $76.7 million from $56.3 million. The predominant, if not only, factor in the sudden profit dip is a massively increased R&D budget, which shot up from $16.5 million in FY 2012 to $56.5 million in FY 2013. Whilst some of those costs are likely to relate to the development of Eve Universe properties Valkyrie, Online and Dust, a significant portion is thought to be attributable to the cancellation of World of Darkness, the Vampire MMO which ceased development earlier this week, resulting in the loss of 56 jobs. A note in CCP's full financial presentation seems to support the theory that a large factor in this $40 million increase in R&D costs was the removal of asset value previously attributed to World of Darkness. via GameIndustry.biz uh-oh. Hope this doesn't hurt too much. Massive increases in R&D usually means long term profits. Example: Blackbarry = Low R&D expenditures. Apple = High R&D expenditures. Blackberry was very successful in the short term, but look at them now. That's what I hope, but if too mutch of that R&D budget was going to WoD then that is bad. If they invested heavily into Dust, Eve, & Valkyrie, it could mean a bright profitable future. Agrios Endendros Heavy Haruko Endendros AV Com & Logi ~ Canti Endendros Pilot ~ Zero Endendros Scout
Joel II X Dah Gods O Bacon 2284	Posted - 2014.04.15 18:53:00 - [10] - Quote RayRay James wrote: Nothing really to worry about, companies run in the red all the time. The death of WoD will be a write off on next years income statements and, voila, back in the green Black. It's back in black (pun intended).

Duran Lex Fraternity of St. Venefice Amarr Empire 712	Posted - 2014.04.15 18:54:00 - [11] - Quote Agrios Endendros wrote: P14GU3 wrote: Not sure if it works the same for CCP, but when most companies say they take a "loss," its not that they really lost any money. See companies project to make so much money for the year, say 50 million USD. If they only earn 40m that year, they "lost" 10m. Oil companies purposely project high every year, so instead of showing that they make Billions every year, they can say they lost a few million... Mainly "in the red" means not profitable and is a bad thing. If there are in the red it means they spent more money than they made. Not always the case. It depends how the information is being presented. He's right on this isn't a big deal, for oil companies do it. They "lose" revenue which is shown "in red" because there are people like you in the world that see this and think "they didn't do so good this year", which usually isn't the case at all.
Agrios Endendros Single Serving Friends 170	Posted - 2014.04.15 19:09:00 - [12] - Quote Duran Lex wrote: Agrios Endendros wrote: P14GU3 wrote: Not sure if it works the same for CCP, but when most companies say they take a "loss," its not that they really lost any money. See companies project to make so much money for the year, say 50 million USD. If they only earn 40m that year, they "lost" 10m. Oil companies purposely project high every year, so instead of showing that they make Billions every year, they can say they lost a few million... Mainly "in the red" means not profitable and is a bad thing. If there are in the red it means they spent more money than they made. Not always the case. It depends how the information is being presented. He's right on this isn't a big deal, for oil companies do it. They "lose" revenue which is shown "in red" because there are people like you in the world that see this and think "they didn't do so good this year", which usually isn't the case at all. I'm pretty sure nobody in the financial world sees this as "doing good". There is a difference between showing lost revenue in red and the company being in the red. Don't get me wrong, I like CCP, that's why I'm concerned. CCP has been around a while and Eve is very successful I'm confident they can recover but $21 milloion is nothing to sneeze at based on their companies value. Agrios Endendros Heavy Haruko Endendros AV Com & Logi ~ Canti Endendros Pilot ~ Zero Endendros Scout
General John Ripper 20057	Posted - 2014.04.15 19:15:00 - [13] - Quote Fox Gaden wrote: Agrios Endendros wrote: Quote: CCP Has recorded a loss of over $21 million for financial year 2013, a considerable drop from a profit of $4.6 million the previous year. Revenues for the company rose to $76.7 million from $56.3 million. The predominant, if not only, factor in the sudden profit dip is a massively increased R&D budget, which shot up from $16.5 million in FY 2012 to $56.5 million in FY 2013. Whilst some of those costs are likely to relate to the development of Eve Universe properties Valkyrie, Online and Dust, a significant portion is thought to be attributable to the cancellation of World of Darkness, the Vampire MMO which ceased development earlier this week, resulting in the loss of 56 jobs. A note in CCP's full financial presentation seems to support the theory that a large factor in this $40 million increase in R&D costs was the removal of asset value previously attributed to World of Darkness. via GameIndustry.biz uh-oh. Hope this doesn't hurt too much. Massive increases in R&D usually means long term profits. Example: Blackbarry = Low R&D expenditures. Apple = High R&D expenditures. Blackberry was very successful in the short term, but look at them now. Just like paying ringers in your pc... only wanna buy and pay for thebest. Everytime I get a like, another bug is fixed. 20k bugs fixed. :)
Nirwanda Vaughns 426th Infantry 539	Posted - 2014.04.15 19:19:00 - [14] - Quote time ot bring back BPOs for us to throw money at. pretty obvious people arn't buying the regular aur suits Rolling with the punches
Nothing Certain Bioshock Rejects 485	Posted - 2014.04.15 19:21:00 - [15] - Quote P14GU3 wrote: Not sure if it works the same for CCP, but when most companies say they take a "loss," its not that they really lost any money. See companies project to make so much money for the year, say 50 million USD. If they only earn 40m that year, they "lost" 10m. Oil companies purposely project high every year, so instead of showing that they make Billions every year, they can say they lost a few million... No, you may be thinking of government budgets but when businesses report port a loss, it is a loss. Because, that's why.
2Berries Ghosts of Dawn General Tso's Alliance 105	Posted - 2014.04.15 19:25:00 - [16] - Quote Let us all bow our heads & pray increase in R&D = PS4...amen, shalom, whatevs.
Agrios Endendros Single Serving Friends 170	Posted - 2014.04.15 19:31:00 - [17] - Quote Canari Elphus wrote: Not quite sure I understand how a decrease in asset valuation would lead to an increase in R&D costs? I'm no expert but I think it's refering to before WoD was cancelled it had an asset value, as in for instance if a company wanted to buy a game in development, they would have to decide on what that unfinished game might be worth. Well that value helped to offset R&D costs on the game. Once that asset value was gone then all that R&D was no longer investment but now loss. I could be wrong on that if anyone has more/better input? Agrios Endendros Heavy Haruko Endendros AV Com & Logi ~ Canti Endendros Pilot ~ Zero Endendros Scout
Aero Yassavi Praetoriani Classiarii Templares Praetoria Imperialis Excubitoris 8019	Posted - 2014.04.15 19:44:00 - [18] - Quote For the record, in 2013 CCP spent 56.5 million USD on research and development. For reference, in 2012 CCP only spent 16.5 million USD on research and development. It's not like they are going to toss down 56.5 million USD every single year. It is a long term investment. So just because you see them in the red now doesn't mean they are in a bad position, they're just betting that all this R&D will pay out big in the future. Amarr are the good guys.
Luk Manag of Terror TRE GAFFEL 412	Posted - 2014.04.15 19:50:00 - [19] - Quote Aero Yassavi wrote: For the record, in 2013 CCP spent 56.5 million USD on research and development. For reference, in 2012 CCP only spent 16.5 million USD on research and development. It's not like they are going to toss down 56.5 million USD every single year. It is a long term investment. So just because you see them in the red now doesn't mean they are in a bad position, they're just betting that all this R&D will pay out big in the future. I would bet that they are throwing money at Eve Valkyrie to capitalize on the industry buzz. There will be bullets. ACR+SMG [CEO of Terror]
COVERT SUBTERFUGE PSU GHOST SYNDICATE DARKSTAR ARMY 904	Posted - 2014.04.15 19:59:00 - [20] - Quote Luk Manag wrote: Aero Yassavi wrote: For the record, in 2013 CCP spent 56.5 million USD on research and development. For reference, in 2012 CCP only spent 16.5 million USD on research and development. It's not like they are going to toss down 56.5 million USD every single year. It is a long term investment. So just because you see them in the red now doesn't mean they are in a bad position, they're just betting that all this R&D will pay out big in the future. I would bet that they are throwing money at Eve Valkyrie to capitalize on the industry buzz. CCP was a day 1 investor of Oculus Rift and was among the first to get the first kits. They said that they believed in the tech and wanted to make a game that really showcased its potential. I dare say this is an important initiative for CCP and warrants decent investment. Many lauded Valkyrie as the most impressive implementation of VR to date. CCP pioneering as usual. Proud Minmatar scout - Republic Merc 7/10 Immune to bitter/jaded vet syndrome Alt of THE GREY CARDINAL - eWar Merc

Zahle Undt Bullet Cluster Lokun Listamenn 1361	Posted - 2014.04.15 20:00:00 - [21] - Quote They spent R&D money for pretty flowing clothing for a game they just cancelled and for Eve pilots to walk around in stations which apparently most Eve players either don't give a **** about or actively hate. Additional money spent on development for VR platforms that will either be the next big leap in gaming or (more likely in my opinion) be short lived fads like motion gaming or the power glove. If their investments payoff for them, good for them, if not they'll be bought out by some massive publisher perhaps, hopefully one of the ones I can stomach and not EA or Activision. Most tankers are like sand people. They frighten easily, but will quickly return...and in greater numbers.
Arkena Wyrnspire Fatal Absolution 12339	Posted - 2014.04.15 20:31:00 - [22] - Quote Zahle Undt wrote: They spent R&D money for pretty flowing clothing for a game they just cancelled and for Eve pilots to walk around in stations which apparently most Eve players either don't give a **** about or actively hate. Additional money spent on development for VR platforms that will either be the next big leap in gaming or (more likely in my opinion) be short lived fads like motion gaming or the power glove. If their investments payoff for them, good for them, if not they'll be bought out by some massive publisher perhaps, hopefully one of the ones I can stomach and not EA or Activision. EVE pilots walking about in stations was not 2013 stuff. So immediately I get the impression that your post is uninformed and quite probably stupid. You have long since made your choice. What you make now is a mistake. EUrobro
Lorhak Gannarsein Science For Death 2702	Posted - 2014.04.15 20:43:00 - [23] - Quote There was a post about this when the report was released. You're a month or two late, OP. ak.0 4 LYFE I am the Lorhak. I speak for the trees.
Xocoyol Zaraoul Superior Genetics 1928	Posted - 2014.04.15 20:46:00 - [24] - Quote Zahle wrote: Undt Eve pilots to walk around in stations which apparently most Eve players either don't give a ** about or actively hate Wat... "You see those red dots over there? Go and shoot them until you see a +50 on the screen" - Arkena Wyrnspire**
Dimmu Borgir II The New Age Outlaws WINMATAR. 338	Posted - 2014.04.15 21:06:00 - [25] - Quote Joel II X wrote: RayRay James wrote: Nothing really to worry about, companies run in the red all the time. The death of WoD will be a write off on next years income statements and, voila, back in the green Black. It's back in black (pun intended). \m/ Blue is good, red is bad, orange you glad you're not red?
bear90211 Nyain San Dirt Nap Squad. 196	Posted - 2014.04.15 21:33:00 - [26] - Quote sooo... dose that mean I can own CCP for 120M $? if so, i might just own it sometime next year My sig is suuper old.. now i rip faces with my HMG. looking for logies yo.btw #tacos
Canari Elphus Dirt Nap Squad. 1433	Posted - 2014.04.15 23:31:00 - [27] - Quote Agrios Endendros wrote: Canari Elphus wrote: Not quite sure I understand how a decrease in asset valuation would lead to an increase in R&D costs? I'm no expert but I think it's refering to before WoD was cancelled it had an asset value, as in for instance if a company wanted to buy a game in development, they would have to decide on what that unfinished game might be worth. Well that value helped to offset R&D costs on the game. Once that asset value was gone then all that R&D was no longer investment but now loss. I could be wrong on that if anyone has more/better input? I was posing the question from an accounting standpoint. I think the author of that article is mixing up terminology and painting a strange picture. Basically, he thinks that a large chunk of the R&D budget went into WoD and, that failing, also reduced the overall asset valuation of the company. CCP spent a good chunk of change trying to get WoD off the ground and, because it never saw the light of day, they have no additional revenues to offset the cost. Still, its a little scary to think that a company increased its R&D costs to more than its income from the previous year. My only guess is that, if most of that was for WoD, they were hoping to launch it pretty quickly to justify the massive increase. @bear90211 - No, that isnt taking into account all assets of the company. That would include physical and intellectual which I am sure are valued at well over 120 million. Canari Elphus for CPM1
The Robot Devil Brave Bunnies Brave Collective 2338	Posted - 2014.04.15 23:43:00 - [28] - Quote Every time they rebalanced this game it is a loss. They lost money in time spent and in money of future profits from the code they had to throw out. Unless you are CCP you don't know how they money was lost, spent or what the defining factors are. It is not worth speculating about unless you are a member of their company and on the board. "One of God's own prototypes. A high-powered mutant of some kind never even considered for mass production." Raoul Duke
Canari Elphus Dirt Nap Squad. 1433	Posted - 2014.04.15 23:48:00 - [29] - Quote The Robot Devil wrote: Every time they rebalanced this game it is a loss. They lost money in time spent and in money of future profits from the code they had to throw out. Unless you are CCP you don't know how they money was lost, spent or what the defining factors are. It is not worth speculating about unless you are a member of their company and on the board. Its the interwebz, what would we do if we didnt have the ability to speculate without basis? Canari Elphus for CPM1
pseudosnipre 667	Posted - 2014.04.15 23:49:00 - [30] - Quote Amazon is spending millions on drone R&D under the banner of faster delivery within large metro areas. Most assume Amazon is hoping to make big bucks on this... Same with VR pioneering. The intellectual property is worth many factors more than anticipated future revenues...hoping that a responsible adult is around who can explain this to you. Today is the sort of day where the sun only comes up to humiliate you. BitterVet the turkey says GOML GOML GOML



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