2020 was the best year in Paradox’s history, reporting a 39 per cent increase in revenue year-on-year, with revenues for the year amounting to SEK 1.8 billion.
Operating profit meanwhile was up 33 per cent, to SEK 632 million.
Despite a strong year, the company saw a weaker performance in Q4 2020, with operating profit falling 51 per cent to SEK 79.5 million, and a 14 per cent growth in revenues to SEK 433.7 million. During this quarter, the company released Romero Games’ Empire of Sin, as well as two expansions: Star Kings for Age of Wonders: Planetfall, and Battle for the Bosporus for Hearts of Iron IV.
During 2020, Paradox invested more than ever before in game development, SEK 614 million, an increase of 45 per cent over last year.
The company explained the drop in profits during Q4 2020 by pointing to Crusader Kings III and Empire of Sin’s “degressive amortisation model,” whereby “larger costs are taken during the first two quarters after the game’s launch.” The company also cancelled an unannounced game during the quarter, causing a negative impact.
Paradox also addressed the recent delay to Vampire: the Masquerade – Bloodlines 2, with the publisher deciding that Hardsuit Labs will no longer be working on the project. Paradox says it has started a collaboration with a new studio partner to finish work on the game.
“This has been a difficult decision, but we are convinced that it is the right way forward to do the game justice,” says Paradox CEO Ebba Ljungerud.
Additionally, Paradox said that it is not satisfied with the launch of Empire of Sin, nor its quality or how it was received by the market. However, the publisher has released a number of updates to the game, and plan to continue to build on the game for the future.
COVID-19’s impact on Paradox’s business was also addressed. While the pandemic initially had a positive impact in sales and an increased player base, the studio has found it difficult to maintain its usual production pace – leading to the cancellation of a number of projects.