Enad Global 7 (EG7), owner of Daybreak Games, Innova, Piranha Games, Antimatter Games, and more, released its Q2 earnings report this week, and while profitable, and primed to handle potential downturns with its varied catalog, noted a couple of highlights, as well as lower profitability under the pandemic, cancellations, and business changes.
According to Acting CEO, Ji Ham:
“EG7 delivered another strong quarter with growth across all segments despite the increasing uncertainties in the global economy. For Q2, the group generated Net Revenue of SEK 462.8 (311.1) million, representing 48.8 percent growth and a strong organic growth of 40.9 percent.”
This amount in SEK is approximately $46.7 million USD, and does not include anything from Innova, the Russian company acquired in 2021, after EG7 announced in April that it was leaving Russia due to the conflict in the region and looking to sell Innova to its existing leadership.
Daybreak Game Company, which operates eight live titles, including The Lord of the Rings Online, EverQuest, EverQuest II, Dungeons & Dragons Online, and DC Universe Online, brought in 251.2 million SEK, or 54.3% of EG7’s net revenue in Q2 2022. Both first-party brands, like EverQuest, and licenses, with The Lord of the Rings Online, the DC Comics license, Dungeons & Dragons, and Magic: The Gathering, are going to be key going forward.
While there were highlights, there was also lower performance as compared to Q2 2021, when the ongoing pandemic boosted results. Another negative was the impact of the cancellation of the Marvel MMORPG project. The “decision to stop developing Marvel and the capitalized development costs together with other group intangible assets was written down, a total write down of -221.6 million SEK”.
Yet, in canceling that project, EG7 reaffirmed investment in its other properties, particularly first-party titles, and a focus on The Lord of the Rings Online, which the report calls “primed for resurgence with the highly anticipated new Amazon streaming series fall of 2022”. This follows Amazon canceling its own Lord of the Rings MMORPG.
You can read the full Q2 financial report over at the Enad Global 7 site.