CCP – Losing Money and Getting Closer to Sony

A couple of interesting/odd things around CCP this week.

CCPlogo

The first is that CCP released their 2013 financial report (you can view it here), in which indicate that they lost $21 million for the year.  It says so right there at the bottom line.

However, if your reaction is, “OMG, Tobold was right! CCP is doomed!” you should calm down.

As Jester covered in detail, the loss came from a capital asset… in this case, software which they no longer feel will generate revenue… being “derecognized.”

Bascially, they wrote some software that they felt had value  because of potential revenue it might generate and called it an asset at some point, adding to the total value of the company.  Now they have decided that the software in question does not have value, again revenue potential comes into play, so they have to take it off the books.  To the shareholders, the company effectively “lost” that much in its overall valuation, but no actual cash money disappeared or changed hands.  The operational aspects of the company were profitable and, as expected, completely dominated by EVE Online, which generated most of the $74 million in revenue from games. (Which is a $9 million boost over 2012.)

So the real question has become, “What software got ‘derecognized?'”

Contenders seem to be World of Darkness related development, “walking in stations” code from the Incarna era,  or maybe some aspect of DUST 514, though the latter, as a whole, did actually generate some revenue in 2013, if not as much as CCP hoped.

The whole thing is muddied up by the fact that CCP dropped the financials out there without any accompanying press release or explanation.  This is no doubt why certain gaming sites, who would likely jump on such a headline as sure-fire click bait, haven’t put up stories about it yet.  “CCP Loses 21 Million Dollars in 2013″ is a winner on that front, right?  But nobody has told them what to think, so they have yet to act. (I, meanwhile, will act without thinking at all!)

Well played CCP.  More as that develops.

Meanwhile, David Reid tweeted last night CCPs virtual reality game, EVE Valkyrie, which has been shown with the Occulus Rift headset up to this point (and which is reportedly getting closer to an actual consumer model), would also be coming to the PlayStation 4 using Sony’s VR headset, currently flying under the code name Project Morpheus… because The Matrix (and not some NASA lander project).

Nifty stuff.  CCP was already close to Sony through DUST 514, which remains (much to the dismay of many EVE Online players) a PlayStation 3 exclusive title.  Now CCP is getting closer still, being in a position to help boost Sony’s new peripheral with software that is already generating “oohs” and “ahhs” from those who have had a chance to play with it.

Over at The Nosy Gamer, there is also speculation that this further tightening relationship between Sony and CCP might also aim to help Sony crack the China market with the PS4 by porting DUST 514 over so they would have a free to play, made in China FPS game to bring to the table.  Or something.

But, going back to the CCP financial statement, one other theory being bandied about is that the “derecognized” software isn’t anything in particular, at least not a whole project being terminated, but rather a collection of odds and ends bundled up to be removed from the books in order to clean things up for a potential financial move in the coming year.  If CCP was going to be involved in a merger or get a major new investor, it would certainly be prudent to have their valuations rock solid.

And, of course, here is Sony, back in the picture again, potentially in a big way, with new technologies and a chance for “firsties” on the VR front in the console wars.

Completely circumstantial… and barely that… but it is enough to make you go, “Hrmmm…”

9 thoughts on “CCP – Losing Money and Getting Closer to Sony

  1. Doyce Testerman

    Or… they made a profit, but they want to claim a loss for tax purposes, so they bundle up some sacrificial code-lambs to make sure the 2013 “net” shows up as red ink.

    There may have been no press release because this isn’t “news”, just crafty bookkeeping.

    Like

  2. Wilhelm Arcturus Post author

    @Doyce – Heh, when does something not being actual news get in the way of a choice headline for some sites?

    I read Game Politics regularly, and I like to chuckle at the stories that aren’t really about games or politics and which aren’t really news.

    Like

  3. Pingback: CCP Posts 2013 Financial Results | MMO Fallout

  4. MrrX

    I think you had it right at the end there – probably a balance sheet cleanup of things people usually don’t want to mess with – long term capital asset accounting is a pain in the ass for most companies.

    Was it in preparation for a merger ? Housekeeping ? That’s the interesting question to me.

    Like

  5. zaphod6502

    CCP better be very careful. It has been proven in the past EVE grognards are notoriously brittle when CCP tries to switch things up.

    Like

  6. Pingback: Link Dead Radio: Indie Ideas and Player Personality | Healing the masses

  7. Pingback: Where Are The Vampire Video Games? | Kitty Kitty Boom Boom

Voice your opinion... but be nice about it...

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s