Month end update - September 2024

I made 105bn profits in September  2024, from which i utilised 20bn of my skill farm (more of that below).  Therefore, my wealth rose by 85bn to 1.721 trillion isk.

Better month than i though given the last part i was on holiday and real life remains busy.

Distributions

These days, the aim is to distribute my profits to the Oz Tank Show or other ventures.

Watching numbers go up once i got to a trillion wealth is somewhat boring.  Hence, my wealth will barely increase and any monthly surplus will all be given away at some point.

So far i have given 260bn isk to the Oz Tank Show and 40bn to The Oz Show.

The OZ Tank Show started in July 2023 and i have generated profits of 897bn in the July 2023 - September 2024 period and distributed 301bn.

So that leaves 596bn isk to distribute to some venture(s).

Six Omega Accounts to pay for / Skill Farming

In June i went for the MCT / Omega deal and have now pre-funded 6 accounts (so the 4 omega accounts and 2 alpha accounts) for 12 months.

This also took me into Skill Farming for the first time.

I spent 130bn isk on all that - and so how to account for this?

Accounting for the MCT / Omega Deal

The question therefore is how to account for the 130bn isk spent on the MCT deal.

The 130bn bought me a 12 month Omega for 6 of my accounts and 12 months of MCT for 2 characters per Account.

As i skill farm i will generate revenues.

The way i have decided to account for this is to:

I will hold the 130bn on by Balance Sheet and as i sell the Skill Points into the market will will reduce the 130bn by the profits made.  This will mean i will not earn any profits from my Skill Farming until the 130bn asset is exhausted.

Hence, in August i made 17bn profits on my Skill Farms and so the 130bn asset reduced to 113bn and then in September i made 20bn profits from Skill Farms and so the asset was reduced further to 93.3bn.

I expect it will take 5 more months to reduce this asset to nil by which time the profits made on the Skill Farming will then be taken as pure profit.

So, thinking this through by the end of February i should have recouped the investment leaving 4 more months of pure profit from Skill Farming, and of course, the 12 months of Omega all paid for each of the 6 accounts.

This was a brilliant deal.

The basic numbers for September

In September i had sales of 369bn isk vs August of 284bn.  So a rise of 30%.

So now back above the long running average 330bn isk.

This comes to average daily sales of 12.3bn isk.  In other words, each evening i expect to see across all my accounts an additional 12bn isk sitting on the characters to be reinvested back into the markets.

Item profits were 132bn isk which is a margin of 36% (132/369).  So back above the 25% target.  There will be an upwards distortion from Skill Farming in here which one day i may attempt to reverse.

Taxes and Courier fees came to 27bn isk.  That takes the Trading Profits to 105bn isk and so a trading margin of 28.5% (105/369).  Again, way above the 16% target.

Then we have 20bn Skill Farming Asset amortised to take me to 85bn increase in wealth for September.

What is needed to get wealth to rise to 100bn in a month?

This still remains my target and i am hoping the Skill Farming will really help in 5 months time.  Technically, i achieved this in September.  Lets see how October goes.

Lets assume i only get the 25% item profit margin that i target . . . . 

To get 100bn isk of an increase in wealth before distributions i would need to make daily sales of 18bn isk.

I am pretty sure i wont get there sustainably on the current strategy so i am putting my mind to how else to earning isk.  Skill Farming is one idea.  May need more.

My Sales Strategy

For me, the market was better in September, back to levels i saw earlier in the year.

My strategy is to Buy from Sell Orders in Jita to sell in the trading hubs in other Regions.

I don't sell consumable items such as ammunition given they tend to be high volume and very competitive.  That includes ships.

I rarely sell items used as components in manufacturing because the end buyer tends to be cost conscious (and armed with spreadsheets) and able to manufacture the items themselves if market prices are too high.

I sell items that are in low supply and sell very slowly.  These items tend to have very low competition - sellers want to get cash quickly and so don't bother in these items.  If i put an item on the market and it sells in 15 days that is fine with me.

I sell items that are typically bought to kit a ship as a player progresses or has to replace a destroyed ship / pod.

Each month i sell 20-30% of what i had to sell at the start of the month.

I have a rule that the minimum profits have to be 100m isk.  It is no use me buying items for 5m to sell them for 15m.  The profitability may be great but that won't move the dials.  That said, it is surprising how many items i can buy for 120m from Jita Sell Orders and sell for 220m in the other trading hubs.  At that isk level, players re-equipping don't care about spending an additional 100m isk to save time.

And in the secondary trading hubs Amarr / Dodixie / Rens / Hek buyers will not travel even one jump to buy a cheaper item.

Therefore, i mostly sell Implants, Blueprints, ship equipment and some structure modules.  And more recently Large Skill Injectors.

What is selling well in September

Again, I saw a decent pickup in Blueprints.  And similar to August i am not seeing Blueprints selling in ones and twos but i am seeing buyers turn up and buy whole groups out.  Not sure why but i don't ask questions.  I would think this indicates more players entering Industry but i am not sure.  I tend to make the target margin of 25% on Blueprints - they are all bought from set prices from NPCs and so all sold at prices to ensure the 25% margins.

Implants were better though they have become more competitive so i have lost market share.  But i am starting to re-enter the market and take on the new competitors.  My experience with Implants is that they sell by the family - i.e. the alpha / beta / delta / epsilon / gamma / omega implant all sell to the same buyer at once.  So they can be good earners when they occur.

Mining equipment used to be a big earner but other competitors are all over this now so for me it is a low sales item.

Ship Equipment did ok.  Likely did better in September but nothing jumps out.  I can't say i pay too much attention as to what really sells - i need to set up a spreadsheet 

I have not sold any structures for a while - so no stations and towers.

Manufacturing

I do this opportunistically and i don't keep track of it.  I don't (yet) do it systematically but i need to get a grip.  I am sure there are many items i sell in the Trade Hubs that i could manufacture in Jita and so get a better in price vs buying them from Jita Sell Orders.

But so far i manufacture items that sell for over 1bn isk.  My favourite items are where the Blueprint Original costs >10bn and there are no Copies in the Contract Market.  Sort of makes me feel i have the market to myself.

Planetary Interaction

For now, i have stopped trying to make this work.

Research

For now, i have stopped trying to make this work.

Station Trading

All in Jita.  And i am not focusing on this for now, so only 24bn sales.

Real life puts this on the back burner.

My idea of station trading is not buying items when they look cheap.  For me, station trading is about sticking to the slow moving items and quite often i am the only person in Jita trying to sell an item.  Almost always Selling for over 1bn isk.

What i don't do is Investing.  I.e. i don't buy an item now i think is cheap and hold onto it to sell it a few months later when the price has risen.

Alpha Accounts

I upgraded 2 of these accounts to Omega as part of the MCT deal.  So training them all hard to get to the 5m skill points to start the skill farm.

That leaves 1 Alpha account with a character in Venal left.  I also added another character to that account and am training it up to 5m skill points.  The idea here is to get another set of Alpha Accounts ready for Skill Farming sometime in the future if needed.

Plex

At the start of September i bought 8000 Plex at around 5.3m each.  The main reason for doing this is to have a store of plex ready in case of any deals on the NEX store that comes along.

The holding of Plex has made a small profit of around 3bn but this is not the reason for holding the Plex - it is purely there as a ready source for any deals that come along.

Items in hanger for sale

There are a number of items that i sell that can only be sourced from Regions outside of The Forge (the home of Jita).

I used to have these items couriered directly to the trading location to sell but that has proved to be tedious over time.

Therefore, i now have the items couriered to Jita and stored.  When i a trade location needs one of these items to be sold i can then courier them from Jita - a much easier process to handle.

In effect this means i am couriering these items twice - once to Jita and once to the trade location.  Therefore, i add the additional courier cost to the Sale's price.

What it means is that items in Hangers used to be 20bn but is now 200bn (this also now includes Skill Extractors and Large Skill Injectors).

Buy Orders

Buy Orders have varied over time but are now back on the rise as i start placing Buy Orders for Skill Extractors.

Once i get a grip, Buy Orders will also increase as i ramp up the Station Trading in Jita.

ISK

For the last 6 months the average ISK in wallets has been over 100bn compared to around 50bn before this.

The reason for his is purely real life being busy and so not having the time to make sure everything is invested.

2 trillion wealth

Not there yet and it is not an aim - i want to give my isk away.

But, worth noting that my wealth is 1.721 trillion and i have given away 301bn - so i would be at 2 trillion by now.

Also, worth noting that my wealth being 1.721 trillion and if i added back the provision of 295bn that i take away then by wealth would be 2 trillion.

Current Wealth

Current wealth is 1.721 trillion ISK made up from:

• Plex held as an investment 46bn ISK
• Items in hanger for sale 204bn ISK
• Items in hanger for use in business 11bn ISK
• Omega brought forward 93bn ISK
• Buy orders on the market 54bn ISK
• items for sale 1.48 trillion ISK

• less a 20% provision 295bn ISK*

• ISK in wallet 132bn ISK

When i add up my wealth, I don't count assets I use in the course of my business such as ships, fittings etc nor do I add back any expenses such as skills purchased etc.  The wealth I disclose is made up of items that are ISK or are in the process of being converted to ISK or are used to generate isk that can be readily resold back onto the market.  Any ships or skills or fittings etc i buy are counted as expenses in that month.  The only exception to this rule is Blueprint Originals i use for manufacturing.  They are held at cost.

* I take a 20% provision against the items I am selling.  Eve calculates wealth by adding up the value of the sell orders hence it is possible to increase your wealth by buying an item for 100m ISK and putting a sell order for 120m ISK (in this case your wealth would increase by 20m ISK).  For me, I want my wealth to be calculated at cost.  I know that the value of my sell orders will likely fall over time as I update my orders downwards as competition reduces their prices before my items are sold.  Hence the 20% provision is my best guess as to what the maximum reduction I would need to make to my sell orders as a whole before they are sold.  In an ideal world I would value my sell orders at the value which I bought the items for.

Eve Excel Add In - a run through of my sheet to calculate my wealth, Part 2

This is the second part on my series looking at the spreadsheets which use the Eve Online Excel Add-in to calculate my net wealth.

This sheet focuses on the assets i hold in hangers and is quite annoying in that i have not yet managed to work out how i can do this in one line per character.

i.e. in the prior sheet for each character it only takes one line to calculate the total Sell Orders for example.

For the assets in hangers i need to list them all out and then make sure i am not counting Blue Print Copies.

The basics of the Spreadsheet is that for each character i list out all the assets in the hangers and then value them off Jita prices.  This will also capture all Blueprint Copies which i need to eliminate.  I then list all the Blueprints and if they are a copy i add them all up and take them away from the first list.  All will be clear on the spreadsheet below.

I also do something similar for the Corporate which captures everything in Corporate Hangers.  I.e. items delivered from courier contracts.

Lets go through the first character:

Cell D4 picks up the character ID from the list i input in column D.  See the prior post in where to get the character IDs.  There are two ways.

Cells E4, F4 and G4 get the character name, system and Region:

=EVEONLINE.CHARACTER(D4),  =EVEONLINE.SOLARSYSTEM(MODE(EVEONLINE.CHARACTER_ASSETS(D4).final_location.solar_system_id)).solar_system_name,  =EVEONLINE.REGION(MODE(EVEONLINE.CHARACTER_ASSETS(D4).final_location.region_id)).name)

The real work starts in cell D9 with the formula =EVEONLINE.CHARACTER_ASSETS(D4)

This lists all the assets held in hangers for the character where D4 is the cell containing the character ID.  It will form a list.

Column E will then take each item in column D and get the quantity =D9.quantity

Column F will then get the minimum Sell Price in Jita for each item in Column D =EVEONLINE.MARKET_ORDERS_STATS(10000002,D9.type.id).sell.min

10000002 is the id for The Forge which is the Region where Jita is.

The way this formula works is to bring up all the type.id for each asset item, and then gets the enter market order book in The Forge for this item, and then at the end gets the Sell prices only and then only the minimum.

Column G then multiplies these Columns together to get the value of each asset and then this is all summed up in Cell G7.

But we must now eliminate the value of all Blueprint Copies (which are given the Blueprint Original price).

So, Column I lists all the Blueprints owned by the character =EVEONLINE.CHARACTER_BLUEPRINTS(D4)

Column J then shows how many runs are left for each Blueprint =I9.runs.  If the runs left are -1 then that is a Blueprint Original, otherwise it is a Copy.

Column K then lists the value of only the Copies which in this case instead of multiplying the columns together i just used a new formula =IFERROR(IF(J9<>-1,EVEONLINE.MARKET_ORDERS_STATS(10000002,I9.type.id).sell.min,0),0)

Cell K7 then sums all these Blueprint Copies.

And therefore the sum of all the assets owned is Cell G7 - Cell K7.

Finally, look carefully at how it is done for the Corporation Hangers in columns GB onwards.

Eve Excel Add In - a run through of my sheet to calculate my wealth

I have been using the excel Add-In since it came out to calculate my wealth.

The aim of the excel sheet is to avoid making lists of all the Sell Orders and Buy Orders i have but to try and get as much of it into a one line formula if possible.

Using the Add-In is much quicker than the old days and quite easy to use, though with a reasonably steep learning curve.

Knowledge of excel is a must.

The Spreadsheet

Below is my Excel Spreadsheet (as at the point in time i posted it) and I explain the formulas used.  It is the formulas that count and how they are put together more than anything else.

I will assume that everyone knows how to get the add-in up and running.  If not, a suitable explanation is given by Oz in a youtube video.

In the Sheet itself, every Add-In formula i use is written above the column it is used it.

Items in yellow is data you need to input yourself.

The way to update this sheet if you have it in excel is ctrl + shift + alt + F9

Going through the columns on the main part

Column B - Character ID:

Every character in Eve Online has its own ID.  There are two ways to find this out.

1) Look at your character (or Corporation) on Eve Who and in the URL is your character ID

2) use the formula <=EVEONLINE.ACTIVE_CHARACTER().id> which will list all the ID's of characters you have on the addin.

Either way, we need these character IDs to run the spreadsheet.

Column C - name:

This is an easy formula of <=EVEONLINE.CHARACTER(B9)> where B9 is the cell with a character ID in it.

This will give the name of the character.

<=EVEONLINE.CORPORATION(B14)> gives the name of the Corporation where B14 is the Corporation ID.

Column D - solar system:

Ignore for now, not important and there may be a simpler way.  I will deal with this at the bottom of the post.

Column E - region:

Ignore for now, not important and there may be a simpler way.  I will deal with this at the bottom of the post.

Column F - wallet:

For characters the formula is <=EVEONLINE.CHARACTER_WALLET_BALANCE(B9)> where B9 is the cell with a character ID in it.

For the corporation, you still have to link it to a character with access to the bank accounts (linking it to the corporation will not work).  Also for Corporations there are various parts of the wallet, so they all need to be added up.

So, this is where is gets interesting and we start to use the Excel functionality.

I could use a formula to list out all the balances in all the Corporation accounts which would be <CORPORATION_WALLETS(B9).balance>.  This would list out all the bank balances in the corporation.

But i want one number which is the sum of these hence, the formula is <=SUM(EVEONLINE.CORPORATION_WALLETS(B9).balance)> where B9 is the cell with the ID of a character with access to the Corporation bank accounts.

Note we now have the Excel function <SUM> come in which sums up the list that was produced before into one line.

Column G - Sell Orders:

This is where we really start to use the functionality of the Add-In.

The formula i use to get the sum of all the Sell Orders for a character is <=IFERROR(SUM(EVEONLINE.CHARACTER_ORDERS(B9).price * EVEONLINE.CHARACTER_ORDERS(B8).volume_remain) - SUM(EVEONLINE.CHARACTER_ORDERS(B9).price * EVEONLINE.CHARACTER_ORDERS(B9).is_buy_order * EVEONLINE.CHARACTER_ORDERS(B9).volume_remain),0)>

B8 is the cell with the character ID in it.

Lets break this down.

<=EVEONLINE.CHARACTER_ORDERS(B9)> will list all the Sell and Buy orders for a character including the price and quantity initially put on and what is left.  That is no use - we need to isolate the quantity left to sell, the price and whether it is a Buy or Sell order.

<EVEONLINE.CHARACTER_ORDERS(B9).price> will list the price that the Sell or Buy order is listed at

<EVEONLINE.CHARACTER_ORDERS(B9).volume_remain> will list all the remaining quantity to Sell or Buy.

And this is the beauty of the Add-In and Excel, the formula <=EVEONLINE.CHARACTER_ORDERS(B9).price * EVEONLINE.CHARACTER_ORDERS(B9).volume_remain> will list the value of all the Sell and Buy orders.  It will be a list that multiples the price of each order by the remaining quantity.

Therefore, i can use the Excel SUM function to get the total value of all the Sell and Orders on one line by doing <SUM(EVEONLINE.CHARACTER_ORDERS(B9).price * EVEONLINE.CHARACTER_ORDERS(B9).volume_remain)>

However, this is the combined value of the Sell and Buy Orders.

The Add-In only gives us the ability to isolate the Buy Orders and so i need to take this total value and take away the value of the Buy Orders.

the formula <EVEONLINE.CHARACTER_ORDERS(B9).is_buy_order> gives a True or False for each Order if it is a Buy or Sell Order.

Therefore, i can use the same formula as before but Add-In this bit to give me a list of all Buy Order Values <EVEONLINE.CHARACTER_ORDERS(B9).price * EVEONLINE.CHARACTER_ORDERS(B9).is_buy_order * EVEONLINE.CHARACTER_ORDERS(B9).volume_remain>

and as before i can use the Excel SUM function to get the total value on one line <SUM(EVEONLINE.CHARACTER_ORDERS(B9).price * EVEONLINE.CHARACTER_ORDERS(B9).is_buy_order * EVEONLINE.CHARACTER_ORDERS(B9).volume_remain)>

So, i only now need to take one SUM away from the other to get the total Sell Orders.

And add an IFERROR function at the beginning to give the answer "0" if there are not and Buy or Sell Orders.

Column H - Buy Orders:

<=IFERROR(SUM(EVEONLINE.CHARACTER_ORDERS(B9).price * EVEONLINE.CHARACTER_ORDERS(B9).is_buy_order * EVEONLINE.CHARACTER_ORDERS(B9).volume_remain),0)>

This is merely the SUM of the Buy Orders we used above.

The Add-In gives us the ability to isolate the Buy Orders by using the formula <EVEONLINE.CHARACTER_ORDERS(B9).is_buy_order> which gives a True or False for each Order if it is a Buy or Sell Order.

I also can list the price of each Buy Order <EVEONLINE.CHARACTER_ORDERS(B9).price>.

and i can list the quantity that remains to be bought <EVEONLINE.CHARACTER_ORDERS(B9).volume_remain>.

and so combining these altogether i can get a list of the Buy Orders value per Order <EVEONLINE.CHARACTER_ORDERS(B9).price * EVEONLINE.CHARACTER_ORDERS(B9).is_buy_order * EVEONLINE.CHARACTER_ORDERS(B9).volume_remain>

and as before i can use the Excel SUM function to get the total value on one line <SUM(EVEONLINE.CHARACTER_ORDERS(B9).price * EVEONLINE.CHARACTER_ORDERS(B9).is_buy_order * EVEONLINE.CHARACTER_ORDERS(B9).volume_remain)>

and then wrap it into an IFERROR function to default to 0 if there is an error.

Column I - Inventory:

This is taken from another workbook and will be in a following post.  So far i am unable to nail the value of the inventory held by each character in a one line formula.  Hence i use another workbook to do the calculations.

Column J - Provision vs Sell Orders:

this is merely me taking a 20% provision against each sell order to recognise i will need to pay Transaction Tax when the sale goes through + i may need to list it at a lower value to get it sold.

So nothing to do with the Add-In.

Column K - Contracts outstanding or in progress:

<=IFERROR(SUM(FILTER(EVEONLINE.CHARACTER_CONTRACTS(B9),(EVEONLINE.CHARACTER_CONTRACTS(B9).status="in_progress") + (EVEONLINE.CHARACTER_CONTRACTS(B9).status="outstanding")).collateral),0)>

where B9 is the character ID.

Lets break this down.

I can list all the contracts i have that are "outstanding" and "in progress" and " finished" using the formula <EVEONLINE.CHARACTER_CONTRACTS(B9)>.

But what i am interested in are only those "outstanding" or "in progress".

The Add-In allows me to show the status of each contact using ".status".  So <EVEONLINE.CHARACTER_CONTRACTS(B9).status> will list the status of each contract.

Therefore, i can use the Excel FILTER function to isolate only those that are "outstanding" or "in progress".  The FILTER function works a bit like COUNTIF.  <FILTER(list, condition)>.

I can use multiple conditions and in my case i was either "outstanding" or "in progress".  "+" is the equivalent of "OR".

Therefore, to list only these contracts that are "outstanding" or "in progress" i use the formula <FILTER(EVEONLINE.CHARACTER_CONTRACTS(B9),(EVEONLINE.CHARACTER_CONTRACTS(B9).status="in_progress") + (EVEONLINE.CHARACTER_CONTRACTS(B9).status="outstanding"))>

And then to get the contract value i use ".collateral" to make the formula <FILTER(EVEONLINE.CHARACTER_CONTRACTS(B9),(EVEONLINE.CHARACTER_CONTRACTS(B9).status="in_progress") + (EVEONLINE.CHARACTER_CONTRACTS(B9).status="outstanding")).collateral>.

And of course i want this on one line so i use the SUM function to add it all up <SUM(FILTER(EVEONLINE.CHARACTER_CONTRACTS(B9),(EVEONLINE.CHARACTER_CONTRACTS(B9).status="in_progress") + (EVEONLINE.CHARACTER_CONTRACTS(B9).status="outstanding")).collateral)>

And wrap it in an IFERROR function to return "0" if there is an error.

Column L - Items in Corporate Delivery Hangers:

This is taken from another workbook and will be in a following post

Column M - Plex:

The Add-In can't access the Plex Wallet - so i have to manually input the quanity.

But the Jita minimum Sell price is the formula <=EVEONLINE.MARKET_ORDERS_STATS(10000002,44992).sell.min>

where "10000002" is the ID of The Forge region and "44992" is the ID of Plex.

Column D and E - System Location and Region Location:

These columns list the System and Region each character is in.  There must be na easier way of doing this but for now i cant work it out.  So i have looked for the location for each character where most of their assets are and used that as the assumed location of the character.

so, for System: <=EVEONLINE.SOLARSYSTEM(MODE(EVEONLINE.CHARACTER_ASSETS(B9).final_location.solar_system_id)).solar_system_name>

where B9 is the cell with the character ID.

and for Region: <=EVEONLINE.REGION(MODE(EVEONLINE.CHARACTER_ASSETS(B9).final_location.region_id)).name>

where B9 is the cell with the character ID.

Month end update - August 2024

I made 81bn profits in August 2024, from which i spent 2bn on Omega (more of that below), utilised 17bn of my skill farm (more of that below) and distributed 40bn to The Oz Show for raffles.  Therefore, my wealth rose by 23bn to 1.636 trillion isk.

Better month than i though given the first part i was on holiday and real life remains busy.

Distributions

These days, the aim is to distribute my profits to the Oz Tank Show or other ventures.

Watching numbers go up once i got to a trillion wealth is somewhat boring.  Hence, my wealth will barely increase and any monthly surplus will all be given away at some point.

So far i have given 260bn isk to the Oz Tank Show and 40bn to The Oz Show.

The show started in July 2023 and i have generated profits of 812bn in the July - August period and distributed 301bn.

So that leaves 512bn isk to distribute to some venture(s).

Six Omega Accounts to pay for / Skill Farming

In June i went for the MCT / Omega deal and have now pre-funded 6 accounts (so the 4 omega accounts and 2 alpha accounts) for 12 months.

This also took me into Skill Farming for the first time.

I spent 130bn isk on all that.

The way i am going to account for this is to first account for the Omega i bought previously and then start to account for the MCT/Omega deal.

Hence, for July and August i amortised the remaining Omega bought forward pre MCT/Omega deal.  So that was 8bn in July and around 2 billion in August.

Accounting for the MCT / Omega Deal

The question therefore is how to account for the 130bn isk spent on the MCT deal.

The 130bn bought me a 12 month Omega for 6 of my accounts and 12 months of MCT for 2 characters per Account.

As i skill farm i will generate revenues.

The way i have decided to account for this is to:

I will hold the 130bn on by Balance Sheet and as i sell the Skill Points into the market will will reduce the 130bn by the profits made.  This will mean i will not earn any profits from my Skill Farming until the 130bn asset is exhausted.

Hence, in August i made 17bn profits on my Skill Farms and so the 130bn asset reduced to 113bn.

I expect it will take 6 months to reduce this asset to nil by which time the profits made on the Skill Farming will then be taken as pure profit.

The basic numbers for August

In July i had sales of 284bn isk vs July of 206bn.  So a rise of 38%.

So a nice rebound from what was a poor July but below the average of 330bn.

It comes to 9.2bn sales per day.

Item profits were 105bn isk which is a margin of 37% (105/284).  So back above the 25% and perhaps the 17% made in July was a data glitch which was unwound in August.  Who knows.

Taxes and Courier fees came to 23bn isk.  That takes the Trading Profits to 81bn isk and so a trading margin of 28.7% (81/284).  Again, way above the 16% target.

Then we have the 2bn Omega cost, 17bn Skill Farming Asset amortised and the 40bn distributed to The Oz Show takes me to 23bn increase in wealth for August.

What is needed to get wealth to rise to 100bn in a month?

This still remains my target and i am hoping the Skill Farming will really help in 6 months time.

Lets assume i only get the 25% item profit margin that i target . . . . 

To get 100bn isk of an increase in wealth before distributions i would need to make daily sales of 18bn isk.

I am pretty sure i wont get there sustainably on the current strategy so i am putting my mind to how else to earning isk.  Skill Farming is one idea.  May need more.

My Sales Strategy

For me, the market was better in August.

My strategy is to Buy from Sell Orders in Jita to sell in the trading hubs in other Regions.

I don't sell consumable items such as ammunition given they tend to be high volume and very competitive.  That includes ships.

I rarely sell items used as components in manufacturing because the end buyer tends to be cost conscious (and armed with spreadsheets) and able to manufacture the items themselves if market prices are too high.

I sell items that are in low supply and sell very slowly.  These items tend to have very low competition - sellers want to get cash quickly and so don't bother in these items.  If i put an item on the market and it sells in 15 days that is fine with me.

I sell items that are typically bought to kit a ship as a player progresses or has to replace a destroyed ship / pod.

Each month i sell 20-30% of what i had to sell at the start of the month.

I have a rule that the minimum profits have to be 100m isk.  It is no use me buying items for 5m to sell them for 15m.  The profitability may be great but that won't move the dials.  That said, it is surprising how many items i can buy for 120m from Jita Sell Orders and sell for 220m in the other trading hubs.  At that isk level, players re-equipping don't care about spending an additional 100m isk to save time.

And in the secondary trading hubs Amarr / Dodixie / Rens / Hek buyers will not travel even one jump to buy a cheaper item.

Therefore, i mostly sell Implants, Blueprints, ship equipment and some structure modules.

What is selling well in August

I saw a decent pickup in Blueprints.  And not in 1s and 2s but in 4s and 5s.  Not sure why i would be seeing whole families of Blueprints bought but they are good earners.  Not sure i will see this continue into September.

Making good sales of blueprints can disguise what is a slow market.  For example, i may log in and see that i have made 16bn isk of sales of which Blueprints are 12bn on one character.  So nice to do but not sustainable.

Implants were nice and steady though they have become more competitive so i have lost market share.

Mining equipment for me is very low sales - much more competitive.  I still get decent sales in some items.  I find as we go through the Autumn demand will pick up and should be able to re-enter the market.

Ship Equipment did ok.

I have not sold any structures for a while - so stations and towers.

Manufacturing

I do this opportunistically and i don't keep track of it.  I don't (yet) do it systematically but i need to get a grip.  I am sure there are many items i sell in the Trade Hubs that i could manufacture in Jita and so get a better in price vs buying them from Jita Sell Orders.

But so far i manufacture items that sell for over 1bn isk.  My favourite items are where the Blueprint Original costs >10bn and there are no Copies in the Contract Market.  Sort of makes me feel i have the market to myself.

Planetary Interaction

For now, i have stopped trying to make this work.

Research

For now, i have stopped trying to make this work.

Station Trading

All in Jita.  And i am not focusing on this for now, so only 12bn sales.

Real life puts this on the back burner.

My idea of station trading is not buying items when they look cheap.  For me, station trading is about sticking to the slow moving items and quite often i am the only person in Jita trying to sell an item.  Almost always Selling for over 1bn isk.

What i don't do is Investing.  I.e. i don't buy an item now i think is cheap and hold onto it to sell it a few months later when the price has risen.

Alpha Accounts

I upgraded 2 of these accounts to Omega as part of the MCT deal.  So training them all hard to get to the 5m skill points to start the skill farm.

That leaves 1 Alpha account with a character in Venal left.  I also added another character to that account and am training it up to 5m skill points.  The idea here is to get another set of Alpha Accounts ready for Skill Farming sometime in the future if needed.

Current Wealth

Current wealth is 1.636 trillion ISK made up from:

• Plex held as an investment 0bn ISK
• Items in hanger for sale 189bn ISK
• Items in hanger for use in business 11bn ISK
• Omega brought forward 114bn ISK
• Buy orders on the market 33bn ISK
• items for sale 1.51 trillion ISK

• less a 20% provision 302bn ISK*

• ISK in wallet 83bn ISK

When i add up my wealth, I don't count assets I use in the course of my business such as ships, fittings etc nor do I add back any expenses such as skills purchased etc.  The wealth I disclose is made up of items that are ISK or are in the process of being converted to ISK or are used to generate isk that can be readily resold back onto the market.  Any ships or skills or fittings etc i buy are counted as expenses in that month.  The only exception to this rule is Blueprint Originals i use for manufacturing.  They are held at cost.

* I take a 20% provision against the items I am selling.  Eve calculates wealth by adding up the value of the sell orders hence it is possible to increase your wealth by buying an item for 100m ISK and putting a sell order for 120m ISK (in this case your wealth would increase by 20m ISK).  For me, I want my wealth to be calculated at cost.  I know that the value of my sell orders will likely fall over time as I update my orders downwards as competition reduces their prices before my items are sold.  Hence the 20% provision is my best guess as to what the maximum reduction I would need to make to my sell orders as a whole before they are sold.  In an ideal world I would value my sell orders at the value which I bought the items for.

Another trader close to 1 trillion

Stranathor, who writes the blog I wanna be a Trillionaire, so frickin' bad... is now very close to 1 trillion of wealth.

His trading strategy is very much like my own.  Buying from Jita Sell Orders and having the items couriered to other Regions to sell.

Each month he (i assume it is a he?) updates how he is doing and what he is selling a posts a nice spreadsheet show the details of his wealth.

Different to me, he does some investments that are now almost 40% of his wealth.

I suspect he will be at 1 trillion next week.

The blog is a good read if you want to follow someone's journey from nil to 1 trillion.

Month end update - July 2024

I made 10bn profits in July 2024, increasing my wealth to 1.614 trillion isk.

It was a very slow month, real life was busy and holiday for the last part.

Distributions

These days, the aim is to distribute my profits to the Oz Tank Show or other ventures.

Watching numbers go up once i got to a trillion wealth is somewhat boring.  Hence, my wealth will barely increase and any monthly surplus will all be given away at some point.

So far i have given 260bn isk to the Oz Tank Show.

The show started in July 2023 and i have generated profits of 749bn in the July - July period and distributed 260bn.

So that leaves 489bn isk to distribute to some venture(s).

Six Omega Accounts to pay for

In June i went for the MCT / Omega deal and have now pre-funded 6 accounts (so the 4 omega accounts and 2 alpha accounts) for 12 months.

The way i am going to account for this is to first account for the Omega i bought previously and then start to account for the MCT/Omega deal.

Hence, for July and August i will amortise the remaining Omega bought forward pre MCT/Omega deal.  So thats 8bn in July and around 2 billion in August.

Accounting for the MCT / Omega Deal

I spent 130bn on getting a 12 month Omega for 6 of my accounts and 12 months of MCT for 2 characters per Acocunt.

As i skill farm i will generate revenues.

So, how to account for all this?

I will hold the 130bn on by Balance Sheet and as i sell the Skill Points into the market will will reduce the 130bn by the same value.

I.e. if in one month i sell 10bn of skill points then i will reduce the 130bn by 10bn, so net effect on my wealth will be zero.  So, the effect of selling skill points will not generate me any profits until the 130bn is used up and then it will generate profits.  I expect to generate profits in 6 months time from selling skill points.

The basic numbers for July

In July i had sales of 206bn isk vs June of 392bn.  So a fall of 47%.

That's a big fall and is due to rea life getting busy are real work and a holiday at the end of the month.

It comes to 6.7bn sales per day.

Item profits were 35bn isk which is a margin of 17% (35/206).  That is the first time i have missed the 25% target and i have to say i don't really understand why.  May be a data glitch.  Not sure.  Lets see if it irons itself out in August.

Alternatively, could have been me writing down a number of items for sale to more reasonable levels to get them sold.

Taxes and Courier fees came to 17bn isk.  That takes the Trading Profits to 18bn isk and so a trading margin of 8.8% (18/206).  so way below the 15% target margin.  I really can't explain that, may be a data glitch.  Lets see if it is ironed out in the August update.

Then add in the 8bn plex cost to Omega 4 accounts takes me to 10bn profits made in July.

What is needed to get wealth to rise to 100bn in a month?

Lets assume i only get the 25% item profit margin that i target . . . . 

To get 100bn isk of an increase in wealth before distributions i would need to make daily sales of 18bn isk.

I am pretty sure i wont get there sustainably on the current strategy so i am putting my mind to how else to earning isk.

What i am selling

For me, the market was slow in July.

My strategy is to Buy from Sell Orders in Jita to sell in the trading hubs in other Regions.

I don't sell consumable items such as ammunition given they tend to be high volume and very competitive.  That includes ships.

I rarely sell items used as components in manufacturing because the end buyer tends to be cost conscious (and armed with spreadsheets) and able to manufacture the items themselves if market prices are too high.

I sell items that are in low supply and sell very slowly.  These items tend to have very low competition - sellers want to get cash quickly and so don't bother in these items.  If i put an item on the market and it sells in 15 days that is fine with me.

I sell items that are typically bought to kit a ship as a player progresses or has to replace a destroyed ship / pod.

Each month i sell 20-30% of what i had to sell at the start of the month.

I have a rule that the minimum profits have to be 100m isk.  It is no use me buying items for 5m to sell them for 15m.  The profitability may be great but that won't move the dials.  That said, it is surprising how many items i can buy for 120m from Jita Sell Orders and sell for 220m in the other trading hubs.  At that isk level, players re-equipping don't care about spending an additional 100m isk to save time.

And in the secondary trading hubs Amarr / Dodixie / Rens / Hek buyers will not travel even one jump to buy a cheaper item.

Therefore, i mostly sell Implants, Blueprints, ship equipment and some structure modules.

Manufacturing

I do this opportunistically and i don't keep track of it.  I don't (yet) do it systematically but i need to get a grip.  I am sure there are many items i sell in the Trade Hubs that i could manufacture in Jita and so get a better in price vs buying them from Jita Sell Orders.

But so far i manufacture items that sell for over 1bn isk.  My favourite items are where the Blueprint Original costs >10bn and there are no Copies in the Contract Market.  Sort of makes me feel i have the market to myself.

Planetary Interaction

For now, i have stopped trying to make this work.

Research

For now, i have stopped trying to make this work.

Station Trading

All in Jita.  Even this was slow.  Only made sales of 16bn isk.

My idea of station trading is not buying items when they look cheap.  For me, station trading is about sticking to the slow moving items and quite often i am the only person in Jita trying to sell an item.  Almost always Selling for over 1bn isk.

What i don't do is Investing.  I.e. i don't buy an item now i think is cheap and hold onto it to sell it a few months later when the price has risen.

Alpha Accounts

I upgraded 2 of these accounts to Omega as part of the MCT deal.  So training them all hard to get to the 5m skill points to start the skill farm.

That leaves 1 Alpha account with a character in Venal left.

Current Wealth

Current wealth is 1.614 trillion ISK made up from:

• Plex held as an investment 0bn ISK
• Items in hanger for sale 173bn ISK
• Items in hanger for use in business 11bn ISK
• Omega brought forward 132bn ISK
• Buy orders on the market 34bn ISK
• items for sale 1.49 trillion ISK

• less a 20% provision 298bn ISK*

• ISK in wallet 72bn ISK

When i add up my wealth, I don't count assets I use in the course of my business such as ships, fittings etc nor do I add back any expenses such as skills purchased etc.  The wealth I disclose is made up of items that are ISK or are in the process of being converted to ISK or are used to generate isk that can be readily resold back onto the market.  Any ships or skills or fittings etc i buy are counted as expenses in that month.  The only exception to this rule is Blueprint Originals i use for manufacturing.  They are held at cost.

* I take a 20% provision against the items I am selling.  Eve calculates wealth by adding up the value of the sell orders hence it is possible to increase your wealth by buying an item for 100m ISK and putting a sell order for 120m ISK (in this case your wealth would increase by 20m ISK).  For me, I want my wealth to be calculated at cost.  I know that the value of my sell orders will likely fall over time as I update my orders downwards as competition reduces their prices before my items are sold.  Hence the 20% provision is my best guess as to what the maximum reduction I would need to make to my sell orders as a whole before they are sold.  In an ideal world I would value my sell orders at the value which I bought the items for.

Pearl Abyss Q2 Earnings Call

Pearl Abyss, who are the owners of CCP, had their Q2 results today. 

Full transcript of the call is at the bottom of this post.

The presentation can be found https://irsvc.teletogether.com/pearlabyss/pdf/pearlabyss2024Q2_eng.pdf?2

And, if you speak Korean, the call recording can be found https://irsvc.teletogether.com/pearlabyss/pearlabyss.php?c=pearlabyss&y=2168

The Nosy Gamer also has done a review of the Q2 results https://nosygamer.blogspot.com/2024/08/pearl-abyss-q2-2024-earnings-call.html

Looks to me like revenue were a bit lower than expected and the operating profit loss higher than expected.

Revenues rose 4% in Won to 82bn vs Q2 2023 (always look back a year, rarely makes sense to compare to the prior quarter given seasonality effects)

Within this, Black Desert was up 6% to 60bn and Eve was up 7% to 22bn.

Labour costs were down 8% to 46bn with headcound down 1%, Commissions up 2% to 18bn, Marketing down 9% to 7bn, D&A costs down 3% to 6bn and Other Costs down 7% to 9bn.

Hence an operating loss of 6bn Won (some roundings in there).

This business will not make a profit until Crimson Desert is launched.

Do not forget the Tencent payments which end this year

Revenues were helped by payments from Tencent for terminating Black Desert Mobile in China.

 

Its all about the new games pipeline and launch dates

The market remains focused on the launch of Black Desert Online China and Crimson Desert.

On that matter, management are aiming to launch Black Desert Online China within a year (most are expecting Q4 this year).

For Crimson Desert we would expect marketing to kick off in Gamescom which is this month (21-25 August) where the launch date of Crimson Desert will be given (unless they wait for G-STAR in November to do that).  Therefore, brokers are now pushing back the launch of Crimson Desert to Q3 2025 (i.e. pushing back by 6 months).  This demo and user test at Gamescom will, I suspect, be an important milestone.

As an aside, that pushes back the launch of DokeV to 2026 or later.  Likely later.

There was no news on Plan 8.

 

Existing Games

Black Desert: not much said really.

EVE: Equinox was positive; management planning an expansion pack launch twice a year, and management expects the current positive momentum to continue (citing the launch of EVE Vanguard here).

 

Project Awakening

Which is an EVE IP based blockchain platform – the second test due in “the near term”.

Similarly for EVE Galaxy Conquest.

 

What was said about the Eve Online that we all play?

Firstly, the market barely talks about Eve Online.

That said, it was confirmed that there would be an expansion pack twice a year.

And in the call there was a specific question asking about the improvement in Eve Online revenues.

“The second question is related to EVE IP. And I think we can see that your revenues have been growing for EVE IP. That was quite pronounced. So do you think this trend will continue or do you think there will be a downward stabilization of the EVE IP revenues of below KRW20 billion in the future?”

The answer was:

“I would like to answer your second question about EVE IP revenues. For EVE, with the launching of Equinox, the expansion pack that was launched in Q2 had very good performance. And for EVE, we always plan a twice-a-year expansion pack launching.

And of course, depending on the different timing, for example, of the expansion packs or seasonality factors, there could be some ups and downs, but as you've mentioned, regarding the KRW20 billion or so of revenue level for EVE, we plan to actually maintain that level. And it is true that our user base has been positively affective with the linkage to EVE Vanguard and with the expansion packs. So we will work very hard for us to maintain our revenue level.”

Therefore the brokers expect revenues to grow from here.  About 15% in 2024, 7% in 2025 and then 1-2% onwards.

These growth rates were an increase on prior expectations given the stronger than expected performance of Equinox.  To put this in perspective, the market now thinks Eve Online revenues will be 10% higher in 2024 that was the view before and 7% higher in 2025 and 2026.

I.e. some numbers I can see aimed for Eve Online to have revenues of 78bn Won in 2024, 84bn in 2025 and 84bn in 2026.  These were moved to 84bn, 90bn and 91bn.  And all the uplift comes from Eve Online PC, not Eve Echoes which I note has slightly lower expectations now for 2025.  To put Eve Echoes in perspective, for the 2024 84bn Won hopes in 2024, 21bn is Eve Echoes with 63bn being Eve Online PC.

  

The transcript of the call (translated to English)

 

Q2 2024 Earnings Call

Greetings, I am Kim Yoon from the Pearl Abyss IR team. First of all, I express my deepest gratitude to the analysts and investors in and out of Korea for taking part in the 2024 Q2 Pearl Abyss earnings presentation despite your busy schedules.

Before elaborating on today's business results, I would like to ask for your understanding regarding the following. The financial and business results contained in today's earnings release have been prepared for the convenience of investors and is subject to change depending on the final closing of our books.

In addition, the accuracy and completeness of the financial and business results in the earnings results material are not guaranteed, and the company is not obliged to give updates of the accounts given after this date, so please take these factors into consideration.

We have here with us at the earnings presentation today, Pearl Abyss, CEO; Heo Jin-young; CBO, Kim Gyeong Man; and CFO, Cho Seok-Woo. We will first hear the business performance presentation highlights from CFO, Cho Seok-Woo, and then engage in a Q&A session.

Seok Woo Cho  

Greetings, I am Pearl Abyss CFO, Cho Seok-Woo. Thank you once again for taking part in our company's earnings conference call despite your busy schedules.

I would like to cover Q2 major business highlights and performance. Black Desert and EVE, thanks to our accumulated live service know-how, continued consistent performance, and tests for new services, including Black Desert China and Project Awakening, were carried out.

Black Desert, celebrating 10 years of service, held a Ball in Beynac, France, a real city which appears in Heidel. Around 200 players gathered and enjoyed diverse events, and news about second half major updates, including for Land of the Morning Light; Seoul, was announced.

In addition, at the Ball, updates and episodes during the past 10 years were shared, and participants expressed high satisfaction and positive responses, thanks to our close attention paid to even the smallest details of user feedback. Other than this, in Q2, Guild War content's Siege War and Ancient Anvil was updated to offer a pleasant game-playing environment. In case of Mobile, Askeia Class was launched, and new server Oasis was added, and we worked hard to provide a better game-playing environment and content.

For EVE Online, a new expansion pack Equinox was launched, with a new narrative and stable performance continued. In particular, through this expansion pack, sandbox experience was expanded, including new tools that enable you to make your own spaceships, which allowed you to more strengthen your user identity. In addition, EVE Vanguard showcased the second new map, Solstice, so that users can directly participate in the game before official launching, enabling them to experience major improvements and system changes.

Apart from this, we thoroughly prepared for new services to expand our revenues. First of all, in case of Black Desert China, after the Chinese game license was issued in June, we recently carried out technology tests for smooth service. We also carried out the playtest for Project Awakening, a blockchain-based project and we had the second soft launching based on the first soft launching feedback for our mobile strategy game, EVE Galaxy Conquest, and we are doing our utmost to prepare for its launching.

Next, I will cover Q2 performance. Q2 operating revenue posted KRW81.8 billion, a 4.2% drop Q-o-Q. Operating loss recorded KRW5.8 billion, turning a loss, and net profit posted KRW9.1 billion, a 28.9% drop Q-o-Q.

I will now cover operating revenue in more detail. First, the operating revenue for the major IPs. Black Desert IP operating revenue for this quarter posted KRW60 billion, a 10.2% drop Q-o-Q.

EVE IP operating revenue posted KRW21.6 billion, a 20% growth Q-o-Q. In case of operating revenue for regions, domestic was 18%, Asia was 26%, and North America and Europe posted 56%. In case of operating revenue for platforms, 75% was for PC, 21% for mobile, and 4% for consoles.

Next, I will cover operating expenses. Q2 operating expenses increased 3.2% Q-o-Q and posted KRW87.6 billion. In case of labor expenses, it posted KRW45.7 billion, a 0.6% drop Q-o-Q. For your reference, as of end Q2, the headcount is 1,331. There are 759 developers among them, which is 57% of the total headcount. In case of commissions, it posted KRW18.4 billion, a 7.7% increase Q-o-Q. In case of advertising expenses, with Heidel Ball, which was held in Q2, it posted KRW7.3 billion, a 29.3% increase Q-o-Q.

Last, I will cover Q3 major highlights. In Q3, Black Desert, celebrating its 10-year anniversary, is preparing content full of more interesting adventures. First, we updated Land of Morning Light: Seoul, which had the Joseon representative areas as its motif, to the Korea server yesterday. Land of Morning Light has a background of Old Seoul, including places such as Gyeongbok Palace and Gyeonghoeru, and has updated unique Korean characters like Janghwa Hongryeon and Bulgasal, and will showcase exciting stories.

We plan to update Land of Morning Light; Seoul to the global server in autumn. In addition, we launched the Dosa Class with unique Korean characteristics in July and received positive responses from users. In particular, since Dosa Class was designed to meet the Land of Morning Light concept, swordsmanship and Taoism is used by the character, showing the unique style of Joseon.

In the case of Black Desert console, along with continuous content improvement, there was recent update of Mountain of Eternal Winter. In order to create a better quality and game-playing environment for users, we are accelerating next-generation device version development as well. In case of mobile, Dosa Class was launched in July, and we will soon showcase Azunak War, new survival content combining PvP and PvE.

Black Desert China, after acquiring Chinese game license in June, is thoroughly preparing for its launching. In July, large-scale technology tests were carried out, and there was a service inspection process, and through participating in ChinaJoy, the biggest game event in China, user expectations were heightened. EVE will also showcase diverse content. In particular, there will be an alliance tournament where the best members of each alliance will be in combat, which will make the game more fun.

EVE Vanguard, based on the test of the previous quarter, is continuously making improvements to the game. We will do our best until the end so that we can provide a richer FPS experience until launching and strengthen the EVE ecosystem.

We are also smoothly making preparations for our new titles to secure our new growth engines. First, in the case of Project Awakening, an EVE IP-based blockchain platform, we will carry out the second test so that we can perfect the details of the game.

In the case of EVE Galaxy Quest, while adding to the fun of the game by adding new server and content, we will begin pre-reservations for the official launching. In the case of Crimson Desert, we will participate in diverse game events in the second half to actively promote the game. At Gamescom, which will take place in two weeks, we're planning to have B2C demos where users can directly play the game.

We are preparing for demo events so that we can sufficiently satisfy the heightened expectations of many people, and we will look forward to your keen interest. After first disclosing Crimson Desert in 2019 by our company, we had been making challenges to the AAA market and went through many trials and errors. However, we can now say that Crimson Desert's quality and gameability goes beyond the currently existing open-world games, making the around seven years of development worth the time.

Currently, since we're at the stage when the game is being completed, starting with Gamescom, we will now focus on marketing. We will make thorough preparations so that using our accumulated know-how, it can lead to a successful-launching. To be a better company, all employees from the CEO are doing our best.

We ask for your continued interest and support. Thank you for your attention.

Questions And Answers

 

Question

Thank you very much for this opportunity and I have three questions. The questions are related to Black Desert China, EVE, and related to the second half outlook for your operational losses or profits. So actually, my first question is about your user feedback you got for Black Desert China.

Can you tell us more about the feedback you got and can you also give us any of your information related to when it will be launched? Do you think it will be launched within the end of this year or can you give us more color to the launching date?

The second question is related to EVE IP. And I think we can see that your revenues have been growing for EVE IP. That was quite pronounced. So do you think this trend will continue or do you think there will be a downward stabilization of the EVE IP revenues of below KRW20 billion in the future?

The third question is about your operating expenses. It seems to me that it will be quite challenging for you to have more efficiency in your operating expenses. So there might be some more room for operating losses going forward. So can you give us your guideline for operating profits or losses in the second half of the year or further after that? Thank you very much.

Answer

First of all, I would like to answer your question about Black Desert China Service. For Black Desert China Service, after the Chinese game license was issued in June, we have had the technology test in July, and we participated in China's biggest game event, ChinaJoy, and have been heightening our marketing.

And at ChinaJoy, we had many users visiting us, and we could find out that people had very high expectations about our game. In addition, we had completed well our technology test as of yesterday, and regarding the launching, as was announced by the publisher, we believe that it will be possible within the second half of this year.

And taking into consideration the last optimization work and the schedule of the launching of our competing titles, we have some plans that we will probably have a very fast launching after the Chinese holidays of Chinese Thanksgiving.

Answer

I would like to answer your second question about EVE IP revenues. For EVE, with the launching of Equinox, the expansion pack that was launched in Q2 had very good performance. And for EVE, we always plan a twice-a-year expansion pack launching.

And of course, depending on the different timing, for example, of the expansion packs or seasonality factors, there could be some ups and downs, but as you've mentioned, regarding the KRW20 billion or so of revenue level for EVE, we plan to actually maintain that level. And it is true that our user base has been positively affective with the linkage to EVE Vanguard and with the expansion packs. So we will work very hard for us to maintain our revenue level.

Answer

I would like to answer your third question about making our operational expenses more efficient. We're working very hard to have cost savings of our expenses and that is currently ongoing as well. We're actually expanding our use of machine learning and AI in terms of development and our labor cost burden is going down.

And regarding live services, we are also trying to have more of its transition to AI as well. And we're trying very hard to cut our costs and expenses by making some services internalized and outsourcing some of them when it is more efficient.

And despite all of these efforts, we are having an operating loss because according to our accounting standard, regarding the expenses that go into the development of our new titles, it is not being yet capitalized and it is actually being posted on our account as our expenses.

So that is why, regarding these expenses, even after the launching and when we have higher revenues, we believe that there will not be a great change.

And we believe that our earnings will improve in the second half with more revenues that are going to come into being through the launching.

Question

Thank you very much for the opportunity. Can you tell us more about what is the degree of completion of Crimson Desert? And how much of the remaining development is still there? And can you tell us about to what extent are you going to disclose Crimson Desert at Gamescom and what is its differentiating points? And can you tell us with the launch of Crimson Desert what is the direction of your company aims to go forward?

 

Answer

Thank you very much for your question. For Crimson Desert, we're actually heightening the degree of completion and optimization, and we're smoothly engaging in the last-minute stages.

And since we are nearing the completion of the development, starting off with Gamescom, we will do our best to actually promote our game in earnest and have plans to heighten our degree of marketing.

First of all, at Gamescom, which will take place in two weeks, we are preparing for a 30-minute portion of our demo build where users can directly play the game. Last year, what we did was actually show a three-minute video or trailer at ONL, which is the night event of the Gamescom, and concentrate on marketing with our partner companies. However, for this year, what we're preparing for is the user demo that I aforementioned as well as about a one-hour long, our demo video or trailer, so I believe that you will get a chance to see this through our own channels and through media.

We will do our best so that the users at the Gamescom will play the game. And even for the users that are not there, we will do our best so that they can actually get a taste of Crimson Desert through videos.

Also, after Gamescom, we want Korean users to also experience the game. So we are planning to have B2C demos at G-STAR in Korea in November as well.

And related to the differentiating aspects of Crimson Desert, Crimson Desert will actually show a very high degree of leeway, which will overcome the different open world games that have existed so far. And we have been working hard, so that we can show off game quality that is of a higher level, compared to others.

In addition, we have very immersive stories and graphics, and the degree of completeness is very high. So we are making many efforts, and we believe the results will actually rival that of other AAA games or higher.

And we are committed to actually heightening the degree of completeness or perfection of the game playing until the end of our preparation phase, right before our launching, and strengthen our marketing, so that we will do our best for the best performance of the game.

Question

Thank you for the opportunity. I am Ahn Jaemin from NH Investments and Securities. And I know that you can't exactly pinpoint when exactly the date of when Crimson Desert will be launched, but do you think that it will be similar to the same time next year, in the summertime of next year?

And my second question is that are you considering signing contracts with large-scale global publishers like Sony, Microsoft, or Tencent? Are you in negotiation with any of them? Thank you.

Answer

Well, regarding our launching schedule, since we are smoothly completing the game, I think that regarding when we will launch the game, the visibility is getting clearer and clearer. However, at this Gamescom, we will focus on user marketing. And regarding the more detailed launching date announcement, we will communicate this more to you in the process of our marketing, which will be done in the second half of this year.

And we do know that it's very important for us to have a launching as soon as possible. So all of our developers are doing their best. So we will do our utmost to complete the perfection of our game as soon as possible, so that we can complete the development and prepare for launching as soon as possible as well.

In the case of publishing, well, we thought of many different ways of publishing. However, since we are considering the benefit of our company as our first priority, including having simultaneous launching with PC version, we are now thinking of a direction where we will directly service.

Since we have been directly servicing Black Desert in all different global areas for the last 10 years, and accumulating marketing capability and know-how, we have the confidence that we can successfully service Crimson Desert as well.

Actually, during the last few years at Gamescom and other global events, we were able to successfully promote Crimson Desert and get huge interests from users.

Going forward, we will utilize the accumulated know-how and make thorough preparations that Crimson Desert can get the right result that will be fit its status as a AAA game.