Pearl Abyss has delayed the release schedule of its next title, 'Crimson Desert,' again. After announcing the delay from its original schedule in 2020, it has been postponed by more than four years to next year. Following this news, Pearl Abyss's stock price fell nearly 25% in a single day. Consequently, concerns about Pearl Abyss are also being raised. For the past decade, it has relied on its flagship title, 'Black Desert,' but the disappointing performance has eroded trust among investors and gamers, putting it to the test.
◇ 'Crimson Desert' delayed six times... 'Repeated delays freeze investor sentiment'
According to the Korea Exchange on the 14th, Pearl Abyss's stock closed at 29,650 won the previous day. Just two days ago, the stock price was 39,100 won, but it fell 24.1% in a day. The sharp decline in stock price was due to the announcement of the delay of 'Crimson Desert' during the earnings conference call for the second quarter held that day. Pearl Abyss's stock price soared to 130,000 won in January 2022, benefiting from the COVID-19 pandemic, but has now plummeted to the 20,000 won range.
Pearl Abyss has postponed the release schedule of 'Crimson Desert' a total of six times over nearly four years. Development of 'Crimson Desert' began in 2018, and during a conference call in the first quarter of 2020, it anticipated a simultaneous global release in the fourth quarter of the following year. However, at the second quarter conference call in 2021, Pearl Abyss announced the delay due to the spread of COVID-19 and the need for additional content. The delays continued after that. During the third quarter conference call in 2022, it was expected that development would be completed in the second half of 2023, and at Gamescom the following August, it mentioned a release in the first quarter of 2024. However, at the third quarter conference call of that year, it changed the expression to 'development will be completed within the year' without specifying a concrete release date.
During the first quarter conference call this year, it promised a release in the fourth quarter. At that time, Pearl Abyss stated that the schedule was set considering the development process and competition with overseas anticipated titles such as 'GTA 6'. However, just three months before the promised release date, it announced another delay. Heo Jin-yeong, CEO of Pearl Abyss, noted, "Due to collaboration with partners regarding offline distribution, voiceover, console certification, and schedule adjustments, it seems unavoidable that the release will be delayed by one quarter compared to the schedule previously disclosed."
Following the repeated delays, analysts expressed their distrust. Lee Ji-eun, a researcher at DAISHIN SECURITIES, said, "Adjusting the release schedule doesn't have a significant impact on performance, but repeated delays are a considerable negative factor for investor sentiment," adding, "While the company cites improving development quality and collaboration issues with partners as reasons for delays, given that B2C (business-to-consumer) marketing is set to begin in earnest in 2024, the poor indicators on Steam lead to skepticism about current marketing results."
◇ Relying on 'Black Desert' for a decade... No guarantee of performance rebound even with 'Crimson Desert' release
Currently, Pearl Abyss relies on its main intellectual property (IP), 'Black Desert,' for most of its revenue. As of the second quarter of this year, sales from the Black Desert IP were 54.9 billion won, accounting for about 70% of Pearl Abyss's total revenue of 79.6 billion won. While several game companies have high dependency on a single game, it's rare to find a company that has relied on just one game for nearly ten years since the release of 'Black Desert' in 2015. As the growth of 'Black Desert' slows, Pearl Abyss's revenue is also declining. Pearl Abyss's revenue for the second quarter was 79.6 billion won, a 4.9% decrease compared to the same period last year, and its operating loss widened to 11.8 billion won, compared to a loss of 5.8 billion won in the same period last year.
In the gaming industry, voices of concern about Pearl Abyss are being raised due to this release delay. Pearl Abyss's situation is not only about 'Crimson Desert.' The company gained gamers' expectations by unveiling a trailer for another upcoming title, 'Dokkaebi,' in 2021, but no further information has been released since then. The delay of 'Crimson Desert' raises uncertainty about the release of 'Dokkaebi' as well. Some are criticizing that Pearl Abyss may have hastily unveiled projects that haven't even properly started development to defend its stock price.
Kim Jin-goo, a Kiwoom Securities researcher, stated, "For 'Dokkaebi,' which is assumed to be released in the third quarter of 2027, the lack of updates regarding development and release-related information is increasing uncertainty regarding the follow-up title," adding, "Even assuming a release of 'Crimson Desert' is scheduled for 2026, investors should be informed that the financial performance of 'Dokkaebi,' expected in 2027, cannot be guaranteed, raising the possibility of a disruption in the estimated performance for 2027."
Some voices argue that the release of 'Crimson Desert' does not guarantee Pearl Abyss's success. As domestic game companies have successively entered the console market and successful titles have emerged, users' expectations for domestic console games have risen. When 'Black Desert' was released in 2015, it was rare for domestic large game companies to venture into the console market, and competition with overseas AAA (blockbuster) titles was not as fierce as it is now. However, now that games with completeness and global success, like 'Stellar Blade,' have emerged, it has become challenging to guarantee unconditional success.
A gaming industry official stated, "It is rare for a game to be delayed for over four years globally, and almost unique in Korea," adding, "Pearl Abyss's survival of nearly ten years relying solely on 'Black Desert' is also exceptional. If the release of 'Crimson Desert' continues to be postponed as the growth momentum has faltered, it seems unlikely that trust will be easily restored among investors or gamers."
게임업계 관계자는 "한 게임이 4년 넘게 출시가 미뤄진 건 전 세계적으로 드물고 국내에서는 거의 유일하다"며 "펄어비스가 '검은사막'만으로 10년 가까이 버텨온 것도 이례적인데, 그 성장세마저 꺾인 상황에서 '붉은사막' 출시가 계속 미뤄진다면 투자자나 게이머들의 신뢰 회복이 쉽지 않아 보인다"고 말했습니다.