The Division 2
Epic knew they’d be going through the X-ray machine for its case against Apple, and now some new, rather eye-popping figures have been released showing just how much Epic is losing in order to build up a game base for the Epic Game Store.
What’s shown in the chart below is Epic giving games a guaranteed minimum payout for being on the store, and then…failing to hit that minimum in almost every instance.
Of all the games listed there, only two made money past the minimum, Dauntless and Satisfactory, and only a tiny amount.
But looking at the shortfalls, some of these are just massive, like Metro Exodus being $22.2 million shy of its minimum guarantee and The Division 2 being $24.5 million under. The higher profile the game, the higher the guarantee was likely to be, and the bigger the misses were if they didn’t hit that mark.
Epic has repeatedly said they expect to lose money on the Epic Game Store for a while in order to establish it in the market. A linked report says that Epic has sunk $500 million in total into the Epic Game Store so far, and does not expect to be profitable until 2027, almost six years from now.
"Epic Games Store is unprofitable and not comparable to the App Store" Apple’s lawyers said, "and will not be profitable for at least multiple years, if ever."
They go into more detail:
"Epic lost around $181 million on EGS in 2019. Epic projected to lose around $273 million on EGS in 2020. Indeed, Epic committed $444 million in minimum guarantees for 2020 alone, while projecting, even with 'significant' growth, only $401 million in revenue for that year. Epic acknowledges that trend will continue in the immediate future: Epic projects to lose around $139 million in 2021."
So yes, it is these minimum guarantees that are costing them a fortune, and as we can see from that list, getting above those guarantees is proving to be almost impossible for them. Again, Epic views this as simply “investment” and they know it will take time to become profitable, and yet for as big as Epic is, and as much money as Fortnite and Unreal rake in, it’s not a certainty this will pan out in the long run. But I can’t see Tim Sweeney giving up either.
Epic has always been in a precarious place with this Apple case, but it’s fascinating to watch their inner workings laid bare in an industry so full of secrets. Much more to come, I imagine.
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