BKGaming: Not that I keep up on this as well as some people here, but didn't they change how Gwent's financials were reported in 2018 compared to 2017 which inflated GOG's revenue in 2017? I remember reading something about this. The report also explains 2018 had "ongoing expansion of the development team and upscaling of development activities at CD PROJEKT S.A. and GOG sp. z o.o." compared to 2017.
Which is probably related to Galaxy ( the development of Galaxy's back-end [ie dev portal]), Gwents MP back-end (also handed by GOG reportedly), and other things like the site redesign.
So yea all of that probably played a large part. You typically do bleed money when you are trying to quickly build up and expand. But it is also worth saying that the site redesign is only one part of GOG's overall problems, and as I've said before GOG has the most to lose from the Steam vs Epic battle, and GOG is too hands on to survive at a 12% revenue share and probably to far behind to make enough changes at this point to do so. It's clear from this report, if accurate, that GOG employees are keenly aware of the challenges GOG faces in the future.
Reading into the financial statements...not really. The changes were very minor and didn't substantially affect any of the financials.
Two things have primarily hurt GoG's profitability:
1) Lower sales from CDPR's own games as Witcher 3 is on the way out and GWENT was not the easy revenue replacement it was hoped for. Not to mention Thronebreaker. The sudden drop in sales of CDPR's own products hurt.
2) The value of the U.S. dollar which buys about half of GoG's games.
That said, read between the lines of the Kotaku article.
It seems that have hired more than they laid off. They, of course are worried about this new push about the size of developer cuts. And in anticipation are adjusting their focus to presumably more profitable positions.
We'll have to see what the March 21 report will have to say about Q4. I don't trust Kotaku to get the story right anyway and when they seemingly hype the layoffs when the body of the article seemingly says they have hired more than they have laid off, I find it hard to trust Kotaku's judgement of the overall financial situation. Especially since Kotaku didn't even mention last year's publicly released reports. Typical "quality" reporting from that rag...