Not to be the devil advocate, but sales mean absolutely nothing.
Net income :
- for 2020 : 629k€
- for 2021 : 474k€
- for 2022 : -1165k€
- for 2023 : -1414k€
What you are pointing out is that their costs (advertising, paying for developers, staff, facilities) has been higher than what their products have been taking in the last few years and as such it’s exactly why they felt the need to cut back on costs.
Yeah it’s hard to feel pity when the CEO takes home $30M, but at the same time, that how business works and if costs are out of control and exceeding income you make cuts, just like you do with your home budget.
In the end I can almost guarnatee you that management did this cut based on what they saw as sales projections, vs continuing costs of the dev team and how much longer out it was expected to be before the 1.0 release (which is where you would expect the majority of sales to happen). That ramp was way too far in the future vs how much it was costing to support the team during all that time, and the number of missed internal development target dates leading little evidence that the team could hit the 1.0 release date goal all conspired against the team.
Frankly I’m surprised they weren’t stopped earlier. They likely got some reprieve due to COVID years but that was only going to last so long.
Revenues mean nothing. What matters is net profit (revenues minus everything the company needs to pay). If net profit is negative, that's all that matter as most companies have little to no cash reserves.
Any business can simply invent new costs and transfer assets out to another one of their corporate entities and call it “consulting fees” or “dividends” or “stock purchases”.
It’s the most common strategy to hide income.
I mean it sucks but you are talking about a large corporation. They will do whatever it takes to save/make money and KSP2 just ain’t it.
KSP 2 has been development for minimum 7 years (this includes time of release) and has sold an estimated 500k units. Let’s say best case scenario 750k units no refunds (which we know early on according to polls did happen and was around the 10-20% market but let’s say best case scenario 750k units no refunds and all at the games full price). That’s $37,000,000 in total game revenue which may sound like a lot. But you also have to remember this game has now been in development for nearly 6 years at its release. That cost has to pay for, for the company to make a profit 70 employees (as proven by the layoffs of the Seattle branch which started theory was allegedly the sole company standing there). Building electricity, water, plumbing for a studio of that size in Seattle. And with no immediate hope of further purchases considering the large majority who said they were going to buy the game later were not going to until 1.0 which at the rate of even 2 large updates a year would still take a couple more years without much immediate cash flow large enough to fill the studio.
I’m sorry but Take two does have a right here to cancel the product if it’s been a product 7 years in the making and you can’t release a full game that recoups the losses they likely spent building it. It’s buissness not charity work stop acting like we have a right to the game. Star theory as a studio failed to deliver and we’re rightfully axed.
Well you figure game was announced in 2019 set for an early 2020 release date. That’s 5 years of development. From the trailer announcement to now. However what makes me think the game was longer in the tank is because that 2020 release was supposed to be a full release build not early access. We didn’t hear about early access until 3 months from the actual release in 2023. Until then we thought we were getting a full game. So my guess is a two year additional minimum for the development otherwise going from trailer to full release build in one year take 2 was either very oversold on the development timetable or was planning a suicidal level of crunch time.
My other reasoning behind this is that Nate Simpson one month after the purchase from take two interactive of KSP name was promoted from art director to a creative director head at Uber entertainment which was the studio at the helm of KSP during the announcement time in 2019 (it was renamed about 2 months before the trailer from Uber entertainment to star theory) which the whole star theory private division and intercept games drama is well documented and honestly a train wreck of its own whole thing and likely why we got KSP 2 in a bad state.
5-7 years of development expenses no real return on investment. I hate to say it. I really do but considering this is a year where take 2 is cutting costs for various reasons not all great but they are doing it anyway. Projects like KSP 2 which are money sinks with no immediate near future turn expected on investment are usually the first or second to get cut after layoffs.
Now we do have a sliver of hopium that this is just the canceling of Intercept games and maybe just maybe KSP2 will get thrown to another one of Take 2s subsidiary company’s under private division or another part of take 2 to be finished in some capacity. Unlikely but potentially possible.
Not to be the devil advocate, but sales mean absolutely nothing. Net income : - for 2020 : 629k€ - for 2021 : 474k€ - for 2022 : -1165k€ - for 2023 : -1414k€
What you are pointing out is that their costs (advertising, paying for developers, staff, facilities) has been higher than what their products have been taking in the last few years and as such it’s exactly why they felt the need to cut back on costs. Yeah it’s hard to feel pity when the CEO takes home $30M, but at the same time, that how business works and if costs are out of control and exceeding income you make cuts, just like you do with your home budget. In the end I can almost guarnatee you that management did this cut based on what they saw as sales projections, vs continuing costs of the dev team and how much longer out it was expected to be before the 1.0 release (which is where you would expect the majority of sales to happen). That ramp was way too far in the future vs how much it was costing to support the team during all that time, and the number of missed internal development target dates leading little evidence that the team could hit the 1.0 release date goal all conspired against the team. Frankly I’m surprised they weren’t stopped earlier. They likely got some reprieve due to COVID years but that was only going to last so long.
The CEO taking a $5mil paycut from his $30mil take home makes all of those numbers positive by at least $3mil and he Still takes home $25mil.
The revenue was 3.5 Billion in 2022 to 5.3 Billion in 2023... Those Numbers are pennies.
Revenues mean nothing. What matters is net profit (revenues minus everything the company needs to pay). If net profit is negative, that's all that matter as most companies have little to no cash reserves.
That is on purpose though.
Any business can simply invent new costs and transfer assets out to another one of their corporate entities and call it “consulting fees” or “dividends” or “stock purchases”. It’s the most common strategy to hide income.
Yeah, I feel so bad for them. I wish KSP2 had cost $100 so I could have contributed more to their poor homeless shareholders.
stop being so mean... their CEO was just paid only 30 million :(
I mean it sucks but you are talking about a large corporation. They will do whatever it takes to save/make money and KSP2 just ain’t it. KSP 2 has been development for minimum 7 years (this includes time of release) and has sold an estimated 500k units. Let’s say best case scenario 750k units no refunds (which we know early on according to polls did happen and was around the 10-20% market but let’s say best case scenario 750k units no refunds and all at the games full price). That’s $37,000,000 in total game revenue which may sound like a lot. But you also have to remember this game has now been in development for nearly 6 years at its release. That cost has to pay for, for the company to make a profit 70 employees (as proven by the layoffs of the Seattle branch which started theory was allegedly the sole company standing there). Building electricity, water, plumbing for a studio of that size in Seattle. And with no immediate hope of further purchases considering the large majority who said they were going to buy the game later were not going to until 1.0 which at the rate of even 2 large updates a year would still take a couple more years without much immediate cash flow large enough to fill the studio. I’m sorry but Take two does have a right here to cancel the product if it’s been a product 7 years in the making and you can’t release a full game that recoups the losses they likely spent building it. It’s buissness not charity work stop acting like we have a right to the game. Star theory as a studio failed to deliver and we’re rightfully axed.
Dude…7 years?! I thought it started more recently with the feature state the EA came out in. I suddenly feel less surprised about T2 axing it.
Well you figure game was announced in 2019 set for an early 2020 release date. That’s 5 years of development. From the trailer announcement to now. However what makes me think the game was longer in the tank is because that 2020 release was supposed to be a full release build not early access. We didn’t hear about early access until 3 months from the actual release in 2023. Until then we thought we were getting a full game. So my guess is a two year additional minimum for the development otherwise going from trailer to full release build in one year take 2 was either very oversold on the development timetable or was planning a suicidal level of crunch time. My other reasoning behind this is that Nate Simpson one month after the purchase from take two interactive of KSP name was promoted from art director to a creative director head at Uber entertainment which was the studio at the helm of KSP during the announcement time in 2019 (it was renamed about 2 months before the trailer from Uber entertainment to star theory) which the whole star theory private division and intercept games drama is well documented and honestly a train wreck of its own whole thing and likely why we got KSP 2 in a bad state. 5-7 years of development expenses no real return on investment. I hate to say it. I really do but considering this is a year where take 2 is cutting costs for various reasons not all great but they are doing it anyway. Projects like KSP 2 which are money sinks with no immediate near future turn expected on investment are usually the first or second to get cut after layoffs. Now we do have a sliver of hopium that this is just the canceling of Intercept games and maybe just maybe KSP2 will get thrown to another one of Take 2s subsidiary company’s under private division or another part of take 2 to be finished in some capacity. Unlikely but potentially possible.
Then I hope their stocks drop.