Paradox Interactive posts 61% revenue growth in Q2, driven by Age of Wonders 4 and its focus on core games

Paradox Interactive has released a financial report for the second quarter ended June 30. The Swedish publisher continues to deliver on its growth strategy by supporting its core franchises with live content and investing in new games.

Age of Wonders 4

Financial highlights

• Paradox reached SEK 737.3 million ($71.5 million) in revenue in Q2 2023, up 61% year-over-year.
• The company’s operating profit was SEK 292.9 million ($28.4 million), up 37% from the same period last year.
• Cost of goods in the second quarter amounted to SEK 337.8 million ($32.76 million). This includes game development, support and operation of existing projects, royalties, and revenue-based payments to studios.

Paradox Interactive’s quarterly revenue and operating profit

• The US was the number one region by revenue, accounting for 86% of total sales. It is followed by Europe (10%), while Paradox’s home country Sweden has a 2.2% share.
• PC accounted for 79.9% of the company’s revenue, followed by consoles (14.8%) and mobile (2.2%).

Paradox Interactive’s revenue by platform

What shaped Paradox’s growth in Q2 2023?

The main drivers were Age of Wonders 4 and back catalog titles such as Crusader Kings III, Stellaris, and Cities: Skylines. On top of that, Paradox released multiple DLCs for its existing games and launched mech auto-battler Mechabellum in Early Access.

The latter was published by the Paradox Arc label, which focused on smaller experimental games from third-party teams. According to CEO Fredrik Wester, Mechabellum “met very good interest, albeit at a lower level than the games in our core portfolio, but with the potential to grow over time.”

Paradox didn’t disclose any sales figures or other metrics, but Mechabellum currently holds an 89% rating on Steam based on 3,344 user reviews. The game also peaked at 4,932 concurrent players (via SteamDB), which is the second best result of any Paradox Arc release (the leader is Across the Obelisk with 14k CCU).

Mechabellum

“If we look at the half year, the first six months are very typical for Paradox,” Wester said. ” The first quarter was weaker in terms of the quantity of published content, while a lot of new content was published in the second quarter. Although we are satisfied with the period as a whole, it shows that our results are completely connected to what we release and that the size of the releases continues to vary between periods.”

Paradox’s results in the second quarter were in line with its growth strategy, which includes focusing on core titles, supporting them with DLCs and other new live content, as well as finding promising games from smaller third-party teams.

The publisher currently has 10 “active games” (with ongoing content support) with over 5 million monthly active users (MAU). On top of that, it has 12 titles in its pipeline.