Paradox Interactive’s attempt at a Life Simulation game cost them a lot of money.
A few weeks ago we reported about Life By You, an upcoming life simulation game by Paradox Tectonic being permanently being cancelled. Shortly after the announcement the entire development studio shut down as well, with its employees looking for new job opportunities after almost 4 years of working on the game.
Publisher Paradox Interactive announced in their earnings call about how much this decision cost them. Revealing that close to $20 Million USD were lost to the now failed development of Life By You.
Reported by Game Watcher, the news came from Paradox’s latest earnings call for the second quarter of FY2024. Revealing in the financial report that their operating profit has been decreased by 90% over the last 3 month period.
Paradox is housed in Sweden, so all financial reports are issued in its local currency, Swedish Krona. Operating profit amounted to MSEK 28.9 (MSEK 292.9), a decrease by 90 %. Write-downs of MSEK 208.0 (MSEK 0.0) are included in the operating profit.
– Game Watcher
The CEO of Paradox Interactive shared his sentiment in the earnings call about the cancellation of Life By You. Stating that even though they’ve managed to somewhat stay afloat with their core business operations, they’re still ending the quarter with “mixed feelings”. Mixed feelings being 20 million US dollars loss in revenue.
We end the second quarter of the year with mixed feelings. On the one hand, our core business has performed very well, but on the other hand, we made the difficult decision to cancel the release of Life by You, as the game would not be able to meet our expectations.
Looking at the quarter’s results, we’ve released several strong expansions with good quality to our core games, which has a positive impact on the top line and provides a good cash flow from operating activities. The bottom line is sadly weighed down by the write-down of Life by You. It is painful but gives us a strong motivation to further improve our operations.
The development of Life By You took place in Berkeley, California which housed several Life by You developers at the time who worked on the project for 4 years total. It’s not known what exactly caused Paradox to lose so much money other than having to manage a team of more than a dozen developers in a state with bigger cost of living. Either way, the report seemingly confirms just how much this project was grossly mismanaged.
Paradox Interactive is currently focusing their strengths on their current video game titles, such as Cities Skylines 2. There are only a handful life simulation game competitors to The Sims left to be released. Including Paralives, which is set to release in Early Access in 2025. And InZOI, which looking at the previews will need a NASA super computer to be ran properly.
Stay tuned on Sims Community for more updates on upcoming life simulation games!
