NCSoft is Laying Off Employees and Restructuring into Focused, More Independent Studios After Steep

System · October 24

NCSoft is Laying Off Employees and Restructuring into Focused, More Independent Studios After Steep Profit Drops | MMORPG.com

NCSoft is the latest company to undergo layoffs and reorganization following tough financial results, announcing a less concentrated, more focused studio structure.

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mitech616 · October 24

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

KnightFalz · October 24

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

Large companies make long-term plans years before they come to fruition. That kind of momentum isn't responsive to quick and frequent change so the strategic adjustments one would expect are often somewhat delayed from the events that led to them.

They are essentially lumbering giants with poor reflexes.

Scot · October 24

KnightFalz said:

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

Large companies make long-term plans years before they come to fruition. That kind of momentum isn't responsive to quick and frequent change so the strategic adjustments one would expect are often somewhat delayed from the events that led to them.

They are essentially lumbering giants with poor reflexes.

I only accept this up to a point and I think we are past that point. We can't keep putting staff layoffs down to covid forever, how many more years are going pass and people will be going "that's covid for you". But yes, companies do take a long time to make a decision about anything.

Players have increasing reluctance to jump into new live stream games, games as a whole do not have traction with players like they used too, gaming is bloated with new titles. There are even more reasons, seeing this as just covid is very two dimensional.

Xiaoki · October 24

Scot said:

KnightFalz said:

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

Large companies make long-term plans years before they come to fruition. That kind of momentum isn't responsive to quick and frequent change so the strategic adjustments one would expect are often somewhat delayed from the events that led to them.

They are essentially lumbering giants with poor reflexes.

I only accept this up to a point and I think we are past that point. We can't keep putting staff layoffs down to covid forever, how many more years are going pass and people will be going "that's covid for you". But yes, companies do take a long time to make a decision about anything.

Players have increasing reluctance to jump into new live stream games, games as a whole do not have traction with players like they used too, gaming is bloated with new titles. There are even more reasons, seeing this as just covid is very two dimensional.

When it stops being true.

Because of the massive success of their mobile games during COVID NCsoft had between $100 million to $200 million in operating profit per quarter!

For 4th quarter 2023 NCsoft had an operating profit of $2.8 million.

NCsoft puts all of the information in easily readable charts on their financial section. So, you can go and look for yourself.

https://kr.ncsoft.com/en/ir/irArchive/earningsRelease.do

Angrakhan · October 24

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

This kind of starry eyed optimism is not limited to the gaming industry. I worked for a home builder, that has since been bought out, from 2000 to 2008. 2008 was when we had that massive real estate bubble explosion if you don't recall. Anyway, in 2007 during our "town hall" meetings at corporate all the projections were up and to the right as far as the eye could see. We were hiring people left and right and buying land like crazy because we didn't want to leave all those billions of dollars on the table (company revenue was literally billions annually).

Then the bottom dropped out of the market, and we found ourselves overextended on our land which made us ripe for acquisition.

It's very easy to impune someone's judgement with the benefit of hindsight. However just understand that careers are just as quickly ruined by guessing wrong and missing out on big profits as guessing wrong and being left holding the bag in a downturn.
Ask Steve Ballmer about how missing the mobile phone market affected his career when he made the decision to wait and see, and then entered the market 3rd behind iPhones and Android.

Elidien_ga · October 24

I am in higher ed and work for a large state college in GA. We see the same thing here. COVID affected us a lot and initially it forced a lot of students online but for the public school kids who are now coming to college, they HATED online during COVID and want in-person classes. But older generations that work and want online classes continue that demand. And to top it all off, we are also held to birth trends. In years where fewer students graduate high school, its fewer students coming to college. Well our budget is dictated by enrollment so birth rate drops, 18 years later fewer kids go to college, our budget plummets. Its sad how often people do not look at these trends and see them as a trend or see some events as an enigma. Covid changes some things about the world fundamentally but other things went back to how they were pre-covid. And finally the sad part, people get paid a hell of a lot of money to make these wrong decisions but do not care because their golden parachute saves them while the everyday worker gets laid off.

Scot · October 24

Xiaoki said:

Scot said:

KnightFalz said:

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

Large companies make long-term plans years before they come to fruition. That kind of momentum isn't responsive to quick and frequent change so the strategic adjustments one would expect are often somewhat delayed from the events that led to them.

They are essentially lumbering giants with poor reflexes.

I only accept this up to a point and I think we are past that point. We can't keep putting staff layoffs down to covid forever, how many more years are going pass and people will be going "that's covid for you". But yes, companies do take a long time to make a decision about anything.

Players have increasing reluctance to jump into new live stream games, games as a whole do not have traction with players like they used too, gaming is bloated with new titles. There are even more reasons, seeing this as just covid is very two dimensional.

When it stops being true.

Because of the massive success of their mobile games during COVID NCsoft had between $100 million to $200 million in operating profit per quarter!

For 4th quarter 2023 NCsoft had an operating profit of $2.8 million.

NCsoft puts all of the information in easily readable charts on their financial section. So, you can go and look for yourself.

https://kr.ncsoft.com/en/ir/irArchive/earningsRelease.do

Well then, in your opinion is Nsodt back to its pre covid staff levels yet? Because sooner or later this has to be reductions that go beyond what they had taken on.

Xiaoki · October 24

Scot said:

Xiaoki said:

Scot said:

KnightFalz said:

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

Large companies make long-term plans years before they come to fruition. That kind of momentum isn't responsive to quick and frequent change so the strategic adjustments one would expect are often somewhat delayed from the events that led to them.

They are essentially lumbering giants with poor reflexes.

I only accept this up to a point and I think we are past that point. We can't keep putting staff layoffs down to covid forever, how many more years are going pass and people will be going "that's covid for you". But yes, companies do take a long time to make a decision about anything.

Players have increasing reluctance to jump into new live stream games, games as a whole do not have traction with players like they used too, gaming is bloated with new titles. There are even more reasons, seeing this as just covid is very two dimensional.

When it stops being true.

Because of the massive success of their mobile games during COVID NCsoft had between $100 million to $200 million in operating profit per quarter!

For 4th quarter 2023 NCsoft had an operating profit of $2.8 million.

NCsoft puts all of the information in easily readable charts on their financial section. So, you can go and look for yourself.

https://kr.ncsoft.com/en/ir/irArchive/earningsRelease.do

Well then, in your opinion is Nsodt back to its pre covid staff levels yet? Because sooner or later this has to be reductions that go beyond what they had taken on.

Of course the staff levels will be well below pre-COVID.

Did you even read the article posted?

During COVID NCsoft hired a bunch of new people and started development of a lot of very expensive games thinking the mobile money would always be there to pay for it. When the mobile money dried up almost all of those games were cancelled and the staff let go.

KnightFalz · October 24

Scot said:

KnightFalz said:

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

Large companies make long-term plans years before they come to fruition. That kind of momentum isn't responsive to quick and frequent change so the strategic adjustments one would expect are often somewhat delayed from the events that led to them.

They are essentially lumbering giants with poor reflexes.

I only accept this up to a point and I think we are past that point. We can't keep putting staff layoffs down to covid forever, how many more years are going pass and people will be going "that's covid for you". But yes, companies do take a long time to make a decision about anything.

Players have increasing reluctance to jump into new live stream games, games as a whole do not have traction with players like they used too, gaming is bloated with new titles. There are even more reasons, seeing this as just covid is very two dimensional.

Yeah, there is no way to know how much their current situation is due to lingering Covid fallout or to other factors, at least on the outside looking in.

Rockinw311 · October 24

What about impacts/updates to their Project LLL? Haven't seen updates on it in a long time now

https://about.ncsoft.com/en/news/article/lll-interview-221114

Xiaoki · October 24

Rockinw311 said:

What about impacts/updates to their Project LLL? Haven't seen updates on it in a long time now

https://about.ncsoft.com/en/news/article/lll-interview-221114

Throne and Liberty, Tactan: Knights of the Gods and Project LLL will each be given to new subsidiary studios(and be mostly independent like ArenaNet).

Scot · October 25

Xiaoki said:

Scot said:

Xiaoki said:

Scot said:

KnightFalz said:

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

Large companies make long-term plans years before they come to fruition. That kind of momentum isn't responsive to quick and frequent change so the strategic adjustments one would expect are often somewhat delayed from the events that led to them.

They are essentially lumbering giants with poor reflexes.

I only accept this up to a point and I think we are past that point. We can't keep putting staff layoffs down to covid forever, how many more years are going pass and people will be going "that's covid for you". But yes, companies do take a long time to make a decision about anything.

Players have increasing reluctance to jump into new live stream games, games as a whole do not have traction with players like they used too, gaming is bloated with new titles. There are even more reasons, seeing this as just covid is very two dimensional.

When it stops being true.

Because of the massive success of their mobile games during COVID NCsoft had between $100 million to $200 million in operating profit per quarter!

For 4th quarter 2023 NCsoft had an operating profit of $2.8 million.

NCsoft puts all of the information in easily readable charts on their financial section. So, you can go and look for yourself.

https://kr.ncsoft.com/en/ir/irArchive/earningsRelease.do

Well then, in your opinion is Nsodt back to its pre covid staff levels yet? Because sooner or later this has to be reductions that go beyond what they had taken on.

Of course the staff levels will be well below pre-COVID.

Did you even read the article posted?

During COVID NCsoft hired a bunch of new people and started development of a lot of very expensive games thinking the mobile money would always be there to pay for it. When the mobile money dried up almost all of those games were cancelled and the staff let go.

Can you see how what you said is not making sense? So NCsoft hire a load of new hires, the new games were cancelled and those guys are going. But you also said, "Of course the staff levels will be well below pre-COVID". If this was just about removing the people who came in after covid started then staff levels would not be below those they had pre-covid.

cheyane · October 25

Probably lower because of the losses from putting too much money into hiring and developing the games during covid rush. So naturally it will drop to pre covid levels from overcorrecting and then some more losses because they have less money and want to make the books look better.

Xiaoki · October 25

Scot said:

Xiaoki said:

Scot said:

Xiaoki said:

Scot said:

KnightFalz said:

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

Large companies make long-term plans years before they come to fruition. That kind of momentum isn't responsive to quick and frequent change so the strategic adjustments one would expect are often somewhat delayed from the events that led to them.

They are essentially lumbering giants with poor reflexes.

I only accept this up to a point and I think we are past that point. We can't keep putting staff layoffs down to covid forever, how many more years are going pass and people will be going "that's covid for you". But yes, companies do take a long time to make a decision about anything.

Players have increasing reluctance to jump into new live stream games, games as a whole do not have traction with players like they used too, gaming is bloated with new titles. There are even more reasons, seeing this as just covid is very two dimensional.

When it stops being true.

Because of the massive success of their mobile games during COVID NCsoft had between $100 million to $200 million in operating profit per quarter!

For 4th quarter 2023 NCsoft had an operating profit of $2.8 million.

NCsoft puts all of the information in easily readable charts on their financial section. So, you can go and look for yourself.

https://kr.ncsoft.com/en/ir/irArchive/earningsRelease.do

Well then, in your opinion is Nsodt back to its pre covid staff levels yet? Because sooner or later this has to be reductions that go beyond what they had taken on.

Of course the staff levels will be well below pre-COVID.

Did you even read the article posted?

During COVID NCsoft hired a bunch of new people and started development of a lot of very expensive games thinking the mobile money would always be there to pay for it. When the mobile money dried up almost all of those games were cancelled and the staff let go.

Can you see how what you said is not making sense? So NCsoft hire a load of new hires, the new games were cancelled and those guys are going. But you also said, "Of course the staff levels will be well below pre-COVID". If this was just about removing the people who came in after covid started then staff levels would not be below those they had pre-covid.

/facepalm

Because when you spend money on people you are firing you have to offset that by spending less in other areas which always means firing more people.

We've been talking about this with the big companies laying of thousands for the past year so I shouldn't have to explain this but here we are.

Scot · October 25

Xiaoki said:

/facepalm

Because when you spend money on people you are firing you have to offset that by spending less in other areas which always means firing more people.

We've been talking about this with the big companies laying of thousands for the past year so I shouldn't have to explain this but here we are.

You are saying firing people is costing money, but they are no longer getting wages so there is a net gain. Even when you take severance pay and accrued time off into account, you are saying that firing people creates costs, so you fire more people which also creates costs, so you fire more people...do you see how odd that sounds?

I can certainly see a company wanting to adjust expenditure in the aftermath of a big staff reduction, but removing more staff who in turn generate leaving costs does not fix that problem.

Wargfoot · October 25

I may or may not have heard the layoff notices were delivered on Star Citizen letterhead.

Theocritus · October 25

Xiaoki said:

Scot said:

Xiaoki said:

Scot said:

KnightFalz said:

mitech616 said:

I still don't understand why studios/companies thought that the massive spikes in revenue they had in 2020 were going to be permanent. COVID made people behave in a way outside their normal, and after it was gone. (Surprise!) spending has gone back to normal. Mobile gaming saw a huge spike, then a falloff. This shouldn't be surprising anyone.

Large companies make long-term plans years before they come to fruition. That kind of momentum isn't responsive to quick and frequent change so the strategic adjustments one would expect are often somewhat delayed from the events that led to them.

They are essentially lumbering giants with poor reflexes.

I only accept this up to a point and I think we are past that point. We can't keep putting staff layoffs down to covid forever, how many more years are going pass and people will be going "that's covid for you". But yes, companies do take a long time to make a decision about anything.

Players have increasing reluctance to jump into new live stream games, games as a whole do not have traction with players like they used too, gaming is bloated with new titles. There are even more reasons, seeing this as just covid is very two dimensional.

When it stops being true.

Because of the massive success of their mobile games during COVID NCsoft had between $100 million to $200 million in operating profit per quarter!

For 4th quarter 2023 NCsoft had an operating profit of $2.8 million.

NCsoft puts all of the information in easily readable charts on their financial section. So, you can go and look for yourself.

https://kr.ncsoft.com/en/ir/irArchive/earningsRelease.do

Well then, in your opinion is Nsodt back to its pre covid staff levels yet? Because sooner or later this has to be reductions that go beyond what they had taken on.

Of course the staff levels will be well below pre-COVID.

Did you even read the article posted?

During COVID NCsoft hired a bunch of new people and started development of a lot of very expensive games thinking the mobile money would always be there to pay for it. When the mobile money dried up almost all of those games were cancelled and the staff let go.

I didnt think the mobile money has dried up...Everything I see seems to point to the opposite, but there are getting to be too many games out there and alot will be left behind. Not only that, but on my tablet almost every game is now free with ads.

Scot · October 25

Theocritus said:
I didnt think the mobile money has dried up...Everything I see seems to point to the opposite, but there are getting to be too many games out there and alot will be left behind. Not only that, but on my tablet almost every game is now free with ads.

Mobile is the only platform that is not performing under expectations, but you can see how anyone might be concerned that mobile will get hit to.

The glut of games we have had the last several years is one of the factors that has changed peoples gaming habits, if you give gamers never ending candy how much do you think they will value each game? Either in terms of what they will pay or how much time they will stay with that game?

Xiaoki · October 25

Scot said:

Xiaoki said:

/facepalm

Because when you spend money on people you are firing you have to offset that by spending less in other areas which always means firing more people.

We've been talking about this with the big companies laying of thousands for the past year so I shouldn't have to explain this but here we are.

You are saying firing people is costing money, but they are no longer getting wages so there is a net gain. Even when you take severance pay and accrued time off into account, you are saying that firing people creates costs, so you fire more people which also creates costs, so you fire more people...do you see how odd that sounds?

I can certainly see a company wanting to adjust expenditure in the aftermath of a big staff reduction, but removing more staff who in turn generate leaving costs does not fix that problem.

I could explain why big companies lay off people to save money on quarterly reports ....but why?

You're clearly trolling so talking to you is waste of time.

Scot · October 25

Xiaoki

I could explain why big companies lay off people to save money on quarterly reports ....but why?

You're clearly trolling so talking to you is waste of time.

I would not troll you mate, known you on here for ages. Sure I see why people are laid of to save money, it was the subsequent firings that did not make sense.

Also you don't think we have a shedload of games now, that supply is outstripping demand? In certain areas, like AAA western MMORPGs sure there is a huge gap, but most genres are flooded.

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NCSoft is Laying Off Employees and Restructuring into Focused, More Independent Studios After Steep

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NCSoft is Laying Off Employees and Restructuring into Focused, More Independent Studios After Steep

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