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General discussionCD Projekt: strategy and development of the company, financial results, suggestions by armchair CEOs(686 posts)(686 posts)
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This is my favourite topic
Posted April 15, 2022
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SCPM: Results are out, 2021 sales revenue for GOG dropped from 343 million zloty in 2020 (CP2077 release year) to 199.9 million. Net loss for the unit was about 29 million zloty. Compared to 2019, revenues are up 23%.
https://www.cdprojekt.com/en/investors/result-center/
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BrianSim: +199,983,000 Sales revenues
+1,640,000 Other Operating Revenues

-144,458,000 Cost of products, services, goods & materials sold
-60,382,000 Selling Costs
-6,735,000 General & Admin Costs
-20,609,000 Other Operating Expenses

= -30,561,000 Operating Profit

I'm really not an investor person but what are all these enormous "cost of selling" figures swallowing up everything spending on to the extent you can earn 200m selling something yet still make a 30m loss? And what's the difference between "Cost of products, services, goods and materials sold" vs "selling costs"? Seems to be a 'double whammy' there.

Edit: I mean if you just add those two rows up (144,458,000 Cost of products, services, goods & materials sold + 60,382,000 Selling Costs = it costs 204,840,000 (in costs) to earn 199,983,000 revenue from selling everything? What am I missing there...
They did break it down in one of the PDFs what each one meant. Cost of products, etc was essentially the cut developers get for their games. Selling costs was server maintenance, website maintenance, Galaxy development and a couple other things that I can’t remember. The lack of profit on Gog’s side was ultimately explained away as reduction of sales because the previous year was Cyberpunk and technology depreciation.
Post edited April 15, 2022 by tremere110
Posted April 15, 2022
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It's a shame but seeing the financial results of gog it's a matter of time before the store closes
Posted April 15, 2022
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tremere110: The lack of profit on Gog’s side was ultimately explained away as reduction of sales because the previous year was Cyberpunk and technology depreciation.
This point could use further elaboration and a longer & more detailed commentary.

Is it possible to quote them verbatim in terms of everything they said about what they allege are the reasons for their losses?
Posted April 16, 2022
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tremere110: They did break it down in one of the PDFs what each one meant. Cost of products, etc was essentially the cut developers get for their games. Selling costs was server maintenance, website maintenance, Galaxy development and a couple other things that I can’t remember. The lack of profit on Gog’s side was ultimately explained away as reduction of sales because the previous year was Cyberpunk and technology depreciation.
Thanks for the explanation, it certainly makes sense. So based on Sales = "Sales Revenue", GOG's Cut = "Gross profit from sales" and Operating Costs = "Selling Costs + General, Admin & Other Expenses", that (roughly) makes that?...

2015 - 115.82m Sales / 39.69m GOG's cut / 26.53m Operating Costs / 10.44m Net Profit
2016 - 133.52m Sales / 44.58m GOG's cut / 38.70m Operating Costs / 4.81m Net Profit
2017 - 169.55m Sales / 62.25m GOG's cut / 44.61m Operating Costs / 16.00m Net Profit
2018 - 144.32m Sales / 45.55m GOG's cut / 47.12m Operating Costs / 0.03m Net Profit
2019 - 162.26m Sales / 47.98m GOG's cut / 45.82m Operating Costs / 2.98m Net Profit
2020 - 343.75m Sales / 100.1m GOG's cut / 75.35m Operating Costs / 20.66m Net Profit
2021 - 199.98m Sales / 55.53m GOG's cut / 87.73m Operating Costs / -29.79m Net Profit (Loss)

I know everyone expected profits to be lower in 2021 than Cyberpunk release year (2020), but the scale of the 2021 loss is extremely worrying. As someone said above they actually lost more money in 2021 than they made profit during the 3 years of 2018-2020 combined (including all the Cyberpunk sales & pre-order money). In fact ignoring the 2020 Cyberpunk year aberration, they lost more money in 2021 than profit made during the 4 years of 2016, 2017, 2018 and 2019 combined! I expected some "post-Cyberpunk dip", but I didn't expect such a huge loss on this scale and am left wondering exactly where CDPR will "draw the line". :-(
Posted April 16, 2022
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tremere110: The lack of profit on Gog’s side was ultimately explained away as reduction of sales because the previous year was Cyberpunk and technology depreciation.
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Ancient-Red-Dragon: This point could use further elaboration and a longer & more detailed commentary.

Is it possible to quote them verbatim in terms of everything they said about what they allege are the reasons for their losses?
Too much to post here and I don't really want to post small bits out of context. So here:

https://www.cdprojekt.com/en/wp-content/uploads-en/2022/04/cdr-management-board-report-fy2021.pdf

The board report breaks down and defines a lot of things on the financial statement. The most relevant pages are from 66 to 69.
Posted April 16, 2022
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BrianSim:
Thank you for the summary of the last financial years BrianSim, very valuable. Data looks easier as well.
Posted April 16, 2022
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BrianSim: am left wondering exactly where CDPR will "draw the line". :-(
Speaking of which, do you know if they have ever made any statements in regards to how long of a notice they intend to give their customers in the event that they decide to close GOG?
Post edited April 16, 2022 by Ancient-Red-Dragon
Posted April 16, 2022
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argamasa: Thank you for the summary of the last financial years BrianSim, very valuable. Data looks easier as well.
No problem. To be honest, I'm still trying to understand half of it myself. :-)

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Ancient-Red-Dragon: Speaking of which, do you know if they have ever made any statements in regards to how long of a notice they intend to give their customers in the event that they decide to close GOG?
The only mention of that I've ever seen is in the EULA : "17.3 It seems very unlikely, but if we have to stop providing access to GOG services and GOG content permanently (not because of any breach by you), we will try to give you at least sixty (60) days advance notice by posting a note on www.GOG.COM and sending an email to every registered users – during that time you should be able to download any GOG content you purchased".
https://support.gog.com/hc/en-us/articles/212632089-GOG-User-Agreement?product=gog

So, "we'll try for 2 months" but it's not guaranteed. But whether anything happens to the store or not, it's always a good idea to backup in advance (eg, think of avoiding a mad rush where everyone else who hadn't backed up would all be trying to log in and download everything all at once = slow download speeds, server timeouts, etc).
Post edited April 16, 2022 by BrianSim
Posted April 16, 2022
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Ancient-Red-Dragon: This point could use further elaboration and a longer & more detailed commentary.

Is it possible to quote them verbatim in terms of everything they said about what they allege are the reasons for their losses?
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tremere110: Too much to post here and I don't really want to post small bits out of context. So here:

https://www.cdprojekt.com/en/wp-content/uploads-en/2022/04/cdr-management-board-report-fy2021.pdf

The board report breaks down and defines a lot of things on the financial statement. The most relevant pages are from 66 to 69.
They have lost 7 million dollars. I think that there is no justification for that.

I imagine that in 3 years gog will close.
Post edited April 16, 2022 by GroguSkywalker
Posted April 16, 2022
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Fuuuug. Can't be good :(
Posted April 16, 2022
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Well, depends what you compare with.

And what I'm seeing on GOG is exploding operating costs as of 2020.. And the results of those expenses aren't visible on the store, in fact quite the contrary, looking like they're cutting all corners they can in any customer-facing part.
Posted April 16, 2022
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Cavalary: And what I'm seeing on GOG is exploding operating costs as of 2020.. And the results of those expenses aren't visible on the store, in fact quite the contrary, looking like they're cutting all corners they can in any customer-facing part.
Quite. They've barely invested anything in the store or the website over the past few years. It's all gone into Galaxy.
Posted April 16, 2022
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Cavalary: Well, depends what you compare with.

And what I'm seeing on GOG is exploding operating costs as of 2020.. And the results of those expenses aren't visible on the store, in fact quite the contrary, looking like they're cutting all corners they can in any customer-facing part.
How would you interpret this?
Do you think is isn't that bad or the opposite (quite bad)?
Posted April 16, 2022
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They have 7 million dollars in losses. It's a matter of time before they close. I do not know how there are users who justify these losses.
Posted April 16, 2022
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Vendor-Lazarus: Get woke, go broke. And that's not their only problem, sadly. I miss old good GOG.
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rojimboo: Oh gawd.

Good riddance to the bigots.
Get woke, go broke.
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This is my favourite topic
Community
General discussionCD Projekt: strategy and development of the company, financial results, suggestions by armchair CEOs(686 posts)(686 posts)
(686 posts)