11.9 million euros in losses in 2023 is still a negative result, but still not as much as the 87.5 million euros lost in 2022. Over the past year, Devolver can be satisfied with have again met with a number of critical successes with 5 titles rated at least 80 on Metacritic. The label released 11 games in 2023 (compared to 12 games in 2022), three of which were considered major: Terra Nil, Wizard with a Gun and The Talos Principle 2.
In search of titles capable of generating money over time, the publisher acquired System Era and its Astroneer license, whose performances are “ in line with expectations » since this $18 million purchase last October. Driven by titles like Cult of the Lamb (2022) and Inscryption (2021), back catalog revenues increased by 25%, which is however not enough to prevent a significant decline in revenue due to the lower contribution of new exits, as can be seen in the table.
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Devolver confident for the future
“ 2023 was a rebuilding year for Devolver. We had to make long-term decisions to return to growth and profits in 2024 and beyond. For example, we pushed high-potential titles to 2024, we refused subscription contracts that undervalued our intellectual property, and we reduced our cost base. It's about doubling down on what we're good at: providing a strong pipeline of fun and creative new titles. I want to thank our talented team for their dedication and energy during this difficult year. It is thanks to them that we ended the year 2023 in style, with sequential growth of 10% in turnover in the second half and a return to profits in the second half. », Comments CEO Harry Miller.
As a reminder, Devolver started the year 2024 with a reorganization of its management team. Founder Harry Miller stepped down as chairman of the board in favor of Kate Marsh and replaced Douglas Morin as CEO. At the same time, another founder, Graeme Struthers, was appointed operations director. The publisher currently has 10 titles scheduled for 2024 across the entire group (which includes the Good Shepherd Entertainment label) including Pepper Grinder, Children of the Sun, Le Vaillant Petit Page, Baby Steps, Anger Foot and Neva.
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When the subscription no longer pays as much
The objective will be to release these titles more regularly throughout the year, but as always it is the vagaries of development which have the last word. Proof of this is with Human Fall Flat 2, which we learn is no longer expected in 2025 but in 2026. The game No Brakes Games is one of the biggest assets up Devolver's sleeve, and for good reason , its predecessor published by Curve Games has exceeded 50 million sales worldwide.
Finally, Devolver is back on the subject of subscription offers (PlayStation Plus, Xbox Game Pass) whose amounts no longer correspond to what the publisher expects. As a result, revenue from subscription agreements represented only 16% of Devolver's turnover last year, compared to 23% in 2022. Devolver does not expect this trend to reverse in the near future. the future. “ Following a strong period of subscription contract growth in 2021 and 2022, we declined certain subscription contract offers that we believed undervalued the value of the games offered and the revenue opportunities in 2023 and 2024. Subscription contracts with key platforms remain an element of our long-term growth strategy, but we expect the decline in revenue from direct subscription contracts to continue over the coming years “, we can read.