NCsoft sales rise, income slips

South Korea-based publisher sees quarterly uptick in revenue on Eye of the North release, but net gains down 21 percent year over year.

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Today, NCsoft announced its third-quarter results, and while sales were up 5 percent quarter over quarter to $88.3 million, its net income for the quarter fell 5 percent quarter over quarter to $11.1 million, down a substantial 21 percent year over year.

Supported heavily by its home base, 55 percent of NCsoft's sales occurred in Korea. Breaking down the remaining 45 percent, NCsoft accrued $15.1 million from North America, $9 million from Europe, $8.6 million in Japan, and $2.8 million in Taiwan. The publisher also received $4.8 million in royalty income.

NCsoft noted sales were up 81 percent in Europe, which it attributed to its biggest new release for the quarter, Guild Wars: Eye of the North. In all, total sales of ArenaNet's massively multiplayer online game Guild Wars were up 57 percent on the release of Eye of the North, garnering $14.4 million in sales. However, its Lineage franchise remained the primary breadwinner of the quarter, logging $26.2 million in revenue for the original game and $35.8 million for its successor, Lineage 2. City of Heroes and City of Villains combined for $6.3 million in sales.

NCsoft expects sales to continue to rise in the fourth quarter, riding the roll out of Richard Gariott's Tabula Rasa. Commenting on the company's performance and future outlook, NCsoft CFO JaeHo Lee said, "During the third quarter, sales in North America and Europe rose with the successful launch of the Guild Wars' expansion pack. We expect to see an increase in fourth quarter sales with the newly launched Richard Garriott's Tabula Rasa. Aion is in a closed beta testing process, and user responses are very positive."

Following its deal to develop games for the PlayStation 3 in July, NCsoft has undergone a significant Western expansion in recent months. After receiving a hefty grant from the British government, the publisher revealed it would be nearly doubling its operations in Brighton, England. In October, NCsoft officially unveiled Orange County, California-based Carbine Studios, which is at work on an unannounced game. Yesterday, the publisher announced it had acquired Cryptic Studios' stake in the City of Heroes and City of Villains franchises, and that it would continue development of the two games at its newly formed NorCal Studios in Mountain View, California.

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