business news Elden Ring on top, Devolver in turmoil… the business news of the week
Sales figures, studio buyouts, financial statements, developer transfer window, investments… if these topics interest you, you’ve come to the right place. We offer you an update on the business news of the past week.
Elden Ring regains US sales lead
“The market desperately needs big new releases” : here’s how Matt Piscatella from the research firm NDP Group summarizes the results for the month of May 2022 in the United States. The numbers are bleak: spending on games, consoles and accessories fell 19% to $3.7 billion in revenue. This is the lowest amount since February 2020 ($3.5 billion), and it is also the seventh month in a row that spending has fallen.
The observation is simple: in the top 50 of the best sales in May, we find… only one novelty. This is Evil Dead The Game, installed in 4th place. Faced with the lack of competition, games like Call of Duty Modern Warfare (2019) and Skyrim resurface in the top 20. At the top, it is logically Elden Ring which recovers its throne, dragging LEGO Star Wars The Skywalker Saga to the 2nd place. We can also highlight the good performance of Nintendo Switch Sports which, for its second month of marketing, climbed from 5th to 3rd position. Nintendo games are doing well overall with eight representatives, which is all the more impressive given that eShop sales are not counted here, while Sony puts MLB The Show 22, Horizon Forbidden West and Gran Turismo 7.
On the console side, the Switch was the best-selling console in both volume and value for the month of May. Over the current year, the Nintendo machine dominates in number of units sold, while the Xbox Series has generated the most money.
Devolver: sales worse than expected since January
Having entered the London Stock Exchange last November, Devolver Digital must now communicate regularly on its financial results. This week, the Texas-based publisher warned its investors that sales of its games released between January and May 2022 lower than expected. According to the firm, this is the consequence of a competitive market and “factors specific to each game” which she will take into account for her next titles. “At the same time, there has been an expected increase in amortization costs related to these games as well as increases in general operating expenses due to inflation, headcount and marketing”also notes the communicated.
Over the period concerned, Shadow Warrior 3, Weird West, Trek to Yomi and Serious Sam Siberian Mayhem are the main games released by Devolver. We can note that the first three have in common to have been integrated into a subscription as soon as they were released: the Game Pass for Trek to Yomi and Weird West, and the PS Now for Shadow Warrrior 3.
Devolver expects to raise the bar in the second half of 2022. The publisher will bet on the releases of Return to Monkey Island, Cult of the Lamb, Reigns Three Kingdoms or Wizard with a Gun, but also on its vast catalog of games already available (more than 90 titles) from which comes the majority of its income. Over the whole of 2022, Devolver anticipates a turnover of between 125 and 135 million euros, which would represent a good increase compared to 2021 (90 million euros), and a profit before interest and tax between 25 and 30 million euros.
Focus Entertainment unveils its results, 31 games planned by March 2025
Shutdown for Focus Entertainment. After several years of growth, the French publisher and developer posted sharply lower results for its fiscal year ended March 31, 2022, with revenue of 142 million euros (-17%) and net profit of $3 million (-78%). However, these figures are considered “slightly above expectations” according to the communicated of the group.
Several facts should be highlighted. First, 88% of Focus game sales were made by download. Three games have “strongly contributed to the turnover” : SnowRunner, Insurgency Sandstorm and A Plague Tale: Innocence. The “good performance” from Necromunda Hired Gun and Aliens Fireteam Elite are also mentioned.
Focus says it spent $35 million developing new games during the year, up from $39.5 million the previous year. The firm also spent 59.1 million euros to buy the studios Dotemu, Leikir Studio, Streum On Studio and Douze Dixièmes. To replenish the coffers, 68.8 million euros were raised in May 2021, as well as 130 million euros in the form of bank financing, of which 52 million were drawn at the end of March 2022. As of March 31, the cash of Focus amounted to 62.6 million euros.
Finally, the balance sheet looks to the future in an optimistic way. Focus announces that its line-up of games over the next three years is the most ambitious in its history, with no less than 31 games expected to launch by March 2025. We can already consider Hardspace: Shipbreaker, launched in version 1.0 on May 24, as a success with its 500,000 copies sold. The firm will also be able to count on Teenage Mutant Ninja Turtles: Shredder’s Revenge (released June 16), Evil West (September 20), A Plague Tale: Requiem (whose release date will be revealed on June 23) or even Aliens: Dark Descent (2023). We also learn that a new “ambitious game” developed by Deck13 (The Surge) is scheduled for release in early 2023.
Sony’s Firesprite studio is growing
Firesprite obviously has big ambitions. Acquired by Sony last September, the studio will move to new premises, still located in Liverpool, but much larger with a space of 4,645 m² available against only 215 m² previously. A movement that bears witness to the significant growth it has experienced in recent years. Founded in 2012 by former members of Studio Liverpool (Wipeout), Firesprite now has more than 300 employees and continues to recruit massively, as evidenced by the few 50 job offers listed on its site. Before its acquisition, the studio was already a close partner of Sony. He notably signed the horror FPS The Persistence, first released on PS VR in 2018, and participated in the development of The Playroom and The Playroom VR.
Currently, the British team co-develops the PSVR 2 game Horizon: Call of the Mountain with Guerrilla Games while working on three other AAA projects developed with Unreal Engine 5, as shown by its various job offers. Mention is made of a dark and ambitious narrative adventure game, a PvP multiplayer shooter based on a new license and oriented “game service”, and a multiplayer action game with vehicles. Regarding the latter, there is talk of a reboot of the Twisted Metal franchise according to the rumor.