CD Projekt's annual profit rises 39% on strong Cyberpunk sales

FILE PHOTO: Karolina Kaluzynska, 28, plays CD Projekt's game Cyberpunk 2077 in Warsaw

By Adrianna Ebert

GDANSK (Reuters) -CD Projekt, Poland's biggest games developer, reported a 39% rise in full-year net profit on Thursday, driven by strong sales of its flagship game Cyberpunk 2077 and the Phantom Liberty expansion.

Since Cyberpunk's bug-ridden debut in late 2020, the franchise has grossed revenues exceeding 3 billion zlotys, CD Projekt said.

"Cyberpunk 2077" game has sold more than 25 million copies since its release up to the end of 2023, while "Phantom Liberty", the expansion to the Cyberpunk game, has sold more than 5 million copies.

The company, which faces a couple of years without major game releases, is working on several new projects, including the first instalment in a new trilogy expanding the universe of its blockbuster "The Witcher" medieval fantasy franchise.

The project, code-named Polaris, which has more than 400 people working on it, is scheduled to enter the production phase in the second half of the year, CD Projekt's joint CEO Michal Nowakowski told a conference call.

"I cannot go into too much detail ... but you should not be expecting Witcher 3 in new clothing ... we will be adding things, new elements, new gameplay elements, new mechanics that you haven't seen in our previous games," he said.

Nowakowski said the second most developed game is project Sirius, which is currently in the early pre-production phase.

He also said that CD Projekt plans to maintain its current employment structure in 2024.

"Recruitment will mainly focus on our Boston hub, which is still at an early stage, and we are building its structures," he said, referring to staffing.

Net profit reached 481.1 million zlotys ($120.66 million), beating analysts' expectations of 428 million zlotys. Revenue for the year was up 29% to 1.23 billion zlotys.

CD Projekt's management board has recommended a dividend for 2023 of 1 zloty per share, same as the dividend paid from 2022 profit.

(Reporting by Adrianna Ebert, additional reporting by Anna Pruchnicka and Mateusz Rabiega; Editing by Kirsten Donovan, Leslie Adler and Jane Merriman)