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Aion Drives Sharp Rise In Sales, Profits For NCsoft

Korea-based Guild Wars and City of Heroes publisher NCsoft has reported strong sales and profit gains, thanks to the Asian launch of Aion and continued Lineage stability.
After seeing a drop in fiscal 2008 profits, NCsoft has started 2009 with solid financial results for its first quarter ended March 31. NCsoft said numbers were up because it was able to generate major revenues with its new MMORPG, Aion, which launched in Korea in Q4 2008, as well as maintain stable Asian sales of its flagship franchise Lineage. For Q1, NCsoft reported sales of KRW 133.4 billion ($107.7 million), a 51 percent rise over the same period a year ago. Operating income rose sharply to KRW 42.5 billion ($34.3 million), an increase of 128 percent year-on-year. Net income also saw a steep rise to KRW 33.5 billion ($27 million), a 315 percent year-on-year rise. NCsoft's Aion was able to capture the most sales on a per title basis for NCsoft during Q1, generating KRW 42.65 billion ($34.57 million), nearly as much as Lineage 1 and Lineage 2 made combined. The company said during a conference call that Aion started its open beta last year with 25 servers, and today it has reached 41. NCsoft hopes to launch the game globally by the end of the year. NCsoft CFO Jaeho Lee said in a statement, "Aion has solidified its position as a new growth force without encroaching sales of the Lineage series. Starting with its service in China in Q2, we are ready for a successful launch of this triple-A franchise in Japan, Taiwan, North America and Europe within the second half of the year.” Sales were heavily weighted in favor of NCsoft's homeland South Korea, which saw KRW 89.2 billion ($72.0 million) of overall sales, followed by Japan (KRW 18.1 billion/$14.6 million), North America (KRW 10.8 billion/$8.7 million), Europe (KRW 4 billion/$3.2 million) and Taiwan (KRW 3.9 billion/$3.1 million). Royalties generated KRW 7.4 billion ($5.9 million). Bellevue, Wash.-based NCsoft subsidiary ArenaNet, developers of the six million-selling Guild Wars franchise, is currently at work on its next major release, Guild Wars 2, which NCsoft expects to help boost North American revenues when it launches. NCsoft earnings release also revealed that despite relatively minor job cuts in other areas of the company in recent months, ArenaNet's headcount has grown gradually from quarter to quarter since at least fiscal Q2 2007, from 129 to 175 in Q1 2009. NCsoft's company-wide headcount is currently 2,316, with 1,310 of those in development and the rest serving in non-development functions.

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