The discontinuation of Life by You resulted in a 90 percent drop in profits for Paradox Interactive in the second quarter.
From Paradox Interactive’s recently released Second quarter financial results It turns out that the Swedish publisher has suffered a 90 percent drop in profits compared to the same period last year, to the equivalent of 2.6 million US dollars.
A large part of the decline is due to Life by You, which was discontinued in June and which was affected by a write-off of development costs of 19.2 million US dollars. Paradox’s total revenue fell by 22 percent to the equivalent of 53.3 million US dollars in the second quarter.
“We end the second quarter of the year with mixed feelings,” said Fredrik Wester, CEO of Paradox Interactive. “On the one hand, our core business has performed very well, but on the other hand, we have made the difficult decision to cancel the release of Life By You as the game failed to meet expectations.”
“We have released several strong, high-quality expansions for our core games, which has a positive impact on revenue and provides good cash flow from operations. The bottom line is unfortunately impacted by the write-off of Life By You. This is painful, but it gives us a lot of motivation to continue to improve our business.”
“In 2021, we fundamentally changed the way we invest in higher-risk projects, meaning we did not start any new projects with the same combination of high risk and high cost as Life By You.”
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