NCsoft Reports Eastern Sales Up, Western Sales Way Down

Major global online game developer NCsoft has released its financial results for the 2006 first quarter, showing a significant split in its Eastern and Western region sales, with increased numbers in Korea and Japan, and a significant decrease in North America and Europe. Worldwide sales, covering NCsoft's Korean, Japanese, North American and European markets, were tallied at KRW (Korean Won) 78 billion ($83 million USD). Korean sales were reported at KRW 54.9 billion (US$58.4 million), an increase over the KRW 54.8 billion (US$58.3 million) reported last quarter. Japanese sales were also up, from the previous quarter's KRW 7.9 billion (US$8.4 million) to this quarter's KRW 11.3 billion (US$12 million). The story was different in the western regions, where both American and European sales saw significant reductions over the previous quarter; North American sales were reported at KRW 11.3 billion (US$12 million) down from a previous KRW 26.2 billion (US$27.9 million), and Europe saw KRW 3.8 billion (US$4 million) in sales, down from KRW 7.7 billion (US$8.2 million). The decline in western results has been attributed to slowing sales for the City of Heroes franchise, which launched a new product (City of Villains) in fourth quarter 2005, with combined sales down 58%. Additionally, Guild Wars sales have slowed down dramatically, dropping 57% due to consumer anticipation of Guild Wars Factions' expected second quarter launch. Sales for Lineage and Lineage II remained relatively stable, with reported figures of KRW 30 billion (US$32 million, up 1%) and KRW 29.1 billion (US$31 million, down 4%), respectively. According to a press release issued by NCsoft, these results "were generally in line with forecasts made at the beginning of the year," and the company anticpates resumed growth in the second quarter of 2006, with the launch of new products, including MMO car combat game Auto Assault, released April 13, and Guild Wars Factions, released April 28. "Rather than being bound by short term results, NCsoft will continue to focus on executing its strategy of creating a network of best-of-breed local development talent around the world that outputs a steady pipeline of content onto a global publishing infrastructure," said the release. NCsoft will display a number of upcoming next-gen games at next week's Electronics Entertainment Expo in Los Angeles, including Avion, Dungeon Runners and Tabula Rasa.