It's all just random conjecture since they do not publish official figures on employees, salaries, revenues or profits for ESO, ZOS, Bethesda, Zenimax Parent or even xbox.

The only regular, official numbers I'm aware of come from MS as a whole. We know MS makes a bajillion dollars a year...and that's all we know lol

We get little bits and pieces of info here and there about ESO itself but not enough to extrapolate anything of meaning, sadly.

Gaming as a whole hasn't been profitable for most studios, which is why they are all looking to be bought out.

thedocbwarren wrote: »

If the division is losing 64 cents on the dollar, it's not contributing to the profit of the company as a whole. That would not look great to the board. There is a lot anxiety about this as a whole and it's very easy to search for discussions on this from an investment perspective. And what happened with the transfer of Fallout is only one aspect here. I love this game and the franchises as much as all of us (and also Fallout) but it's a concern and I personally question the investment in the entire division. Just my two cents and I sincerely wish for better times for everyone working on this game and others.

The said they're losing "64 cents on each dollar invested". As for profitability of the Games Division overall, it's reported to be around 3% (which is far, far lower than MS prefers - they want 30%+).

Microsoft, overall, has posted record profits 3 years in a row, nearly 300 Billion in profit just 2023-2025.

Pixiepumpkin wrote: »

Based on glassdoor salaries, the average salary is around 100k.

I saw somewhere recently that ESO is making about 13.3 million a month which means Zenimax Online Media can employ a total of 133 people in that area and that is not counting for electric bills, server hosting, overhead besides salary, building maintenace, etc etc etc. All of which are probably a pretty healthy number monthly, meaning the 133 guesimate is shooting high, way high.

One reason your numbers don‘t add up is that you‘re mixing an annual salary number (100k) with a monthly revenue estimate (13.3 million).

Just keeping with your own calculation, which is very flawed for other reasons as you indicated, it shouldn‘t be 133 people, but almost 1600.

ceruulean wrote: »

Too many out of touch billionaires wanting 20% profit margins or some unsustainable value. The average profit margin for a restaurant is 3-5%. If you can break even and earn a little bit more, enough to live a decent life, why do people want more money? Especially with a digital product that has higher profit margins? Restaurants have to invest almost all the money they earn back into their business or they'll die. Why should gamimg business be any different and have the money siphoned off elsewhere?

Restaurants are also notoriously risky. In the US about one in six don‘t survive their first year and half close within five years. So we should all hope for gaming to be very different.

Besides, such a low margin means there‘s no room for error. A small drop in revenue or a bit of cost increase will leave you in the red. It‘s the equivalent of living paycheck to paycheck with practically no build-up of savings. Or would you be content if only 3% of your income was left at the end of the month?

Gabriel_H wrote: »

We don't know 213 were laid off, we know 213 were laid off or at hours reduced by 50% at that one site.

As to why layoff in the first place, streamlining and more profit is always good (Capitalisms mantra not mine).

There is a document surfaced on reddit, albeit I'm not sure how genuine it is (but who really needs to forge it anyway) "Eliminations of 379 positions", "Actual termination date" don't mean hour reductions for sure.
https://www.reddit.com/r/elderscrollsonline/comments/1uxg18d/official_breakdown_of_zoszm_positions_laid_off/

Gabriel_H wrote: »

Pixiepumpkin wrote: »

I have to imagine at some point the studio will need to actually produce a profit meaning labor will have to come down, meaning less employees or lowering their wages, except people in that area cant really afford to make less money.

The projections I have seen from those in the industry peg the net profit margin at over 70%.

We aren't getting any sort of source on this, are we?

Gabriel_H wrote: »

FENGRUSH wrote: »

Gabriel_H wrote: »

Pixiepumpkin wrote: »

I have to imagine at some point the studio will need to actually produce a profit meaning labor will have to come down, meaning less employees or lowering their wages, except people in that area cant really afford to make less money.

The projections I have seen from those in the industry peg the net profit margin at over 70%.

We aren't getting any sort of source on this, are we?

You appear to have access to the same internet I do.

Yea and theres no financial data at all on the subject. Best piece people have is 2 billion over a decade. Absolutely no info on costs. More importantly, no accurate data on the last year or future projections on a game posting its worst numbers in the last 5 years.

Looks like youre throwing out best case scenario hopium and intending for it to be reliable information unless proven otherwise.

Here's a reliable piece or data - ESOs population has been in decline since post covid. Microsoft is reacting as such and readjusting this studio to better align with a future that focuses on large scale projects. Things like eso and f76 may in fact be making profit, but its not to the degree you've suggested.

The reality is the restructuring of all of these studios and solving a larger issue in the AAA dev space of bloated teams and a flatter management philosophy. If the entire studio went away tomorrow and eso with it, it doesnt really impact the new direction of the Xbox game divisions. ES6, new fallout - this is the future of the zenimax umbrella. Everything else is a stepping stone at this point.

Gabriel_H wrote: »

FENGRUSH wrote: »

Gabriel_H wrote: »

FENGRUSH wrote: »

Gabriel_H wrote: »

Pixiepumpkin wrote: »

I have to imagine at some point the studio will need to actually produce a profit meaning labor will have to come down, meaning less employees or lowering their wages, except people in that area cant really afford to make less money.

The projections I have seen from those in the industry peg the net profit margin at over 70%.

We aren't getting any sort of source on this, are we?

You appear to have access to the same internet I do.

Yea and theres no financial data at all on the subject. Best piece people have is 2 billion over a decade. Absolutely no info on costs. More importantly, no accurate data on the last year or future projections on a game posting its worst numbers in the last 5 years.

Looks like youre throwing out best case scenario hopium and intending for it to be reliable information unless proven otherwise.

Here's a reliable piece or data - ESOs population has been in decline since post covid. Microsoft is reacting as such and readjusting this studio to better align with a future that focuses on large scale projects. Things like eso and f76 may in fact be making profit, but its not to the degree you've suggested.

The reality is the restructuring of all of these studios and solving a larger issue in the AAA dev space of bloated teams and a flatter management philosophy. If the entire studio went away tomorrow and eso with it, it doesnt really impact the new direction of the Xbox game divisions. ES6, new fallout - this is the future of the zenimax umbrella. Everything else is a stepping stone at this point.

... or you just don't know how to use google.

Lets go with basic math. $100k average salary. 250 employees. That's $25m a year in costs and the largest chunk of operating costs by far. Lets double that to account for server costs and tack some extra on for heat, light, stationary etc. That's $60m a year versus revenues of around $200m.

Edit: Oh and we have no idea about the state of player numbers. Just the Steam ones, and given some extrapolation from the NM event, they make up only around 25% of player numbers.

Employment cost is higher than just salary, so your $25M needs to be adjusted upwards and profit margin down.

Are both the reported revenue AND the head count for the entirety of ZOS operations? After all, it's been pointed out multiple times in other threads that they have other locations (including outside of the US). I get the impression that the 230 figure is just the "home" campus, which means employment and operational costs are significantly underestimated.

LootAllTheStuff wrote: »

Gabriel_H wrote: »

FENGRUSH wrote: »

Gabriel_H wrote: »

FENGRUSH wrote: »

Gabriel_H wrote: »

Pixiepumpkin wrote: »

I have to imagine at some point the studio will need to actually produce a profit meaning labor will have to come down, meaning less employees or lowering their wages, except people in that area cant really afford to make less money.

The projections I have seen from those in the industry peg the net profit margin at over 70%.

We aren't getting any sort of source on this, are we?

You appear to have access to the same internet I do.

Yea and theres no financial data at all on the subject. Best piece people have is 2 billion over a decade. Absolutely no info on costs. More importantly, no accurate data on the last year or future projections on a game posting its worst numbers in the last 5 years.

Looks like youre throwing out best case scenario hopium and intending for it to be reliable information unless proven otherwise.

Here's a reliable piece or data - ESOs population has been in decline since post covid. Microsoft is reacting as such and readjusting this studio to better align with a future that focuses on large scale projects. Things like eso and f76 may in fact be making profit, but its not to the degree you've suggested.

The reality is the restructuring of all of these studios and solving a larger issue in the AAA dev space of bloated teams and a flatter management philosophy. If the entire studio went away tomorrow and eso with it, it doesnt really impact the new direction of the Xbox game divisions. ES6, new fallout - this is the future of the zenimax umbrella. Everything else is a stepping stone at this point.

... or you just don't know how to use google.

Lets go with basic math. $100k average salary. 250 employees. That's $25m a year in costs and the largest chunk of operating costs by far. Lets double that to account for server costs and tack some extra on for heat, light, stationary etc. That's $60m a year versus revenues of around $200m.

Edit: Oh and we have no idea about the state of player numbers. Just the Steam ones, and given some extrapolation from the NM event, they make up only around 25% of player numbers.

Employment cost is higher than just salary, so your $25M needs to be adjusted upwards and profit margin down.

Are both the reported revenue AND the head count for the entirety of ZOS operations? After all, it's been pointed out multiple times in other threads that they have other locations (including outside of the US). I get the impression that the 230 figure is just the "home" campus, which means employment and operational costs are significantly underestimated.

It's a basic estimate. I'm greatly inflating other costs. It's fine as a ballpark. Any additional wage costs will come from taxes, so that's around an extra $12m, but there is no way server costs run at ~40% of costs. The 250 is also an estimate following the layoffs, though some sources are saying the new headcount is below 200 total.

Just for some context: Server costs would be about $1m a year if I applied the industry standard for concurrent players. Much less than the $25m I rammed in there to deliberately over inflate the costs.

tomofhyrule wrote: »

Gabriel_H wrote: »

INM wrote: »

Gabriel_H wrote: »

We don't know 213 were laid off, we know 213 were laid off or at hours reduced by 50% at that one site.

As to why layoff in the first place, streamlining and more profit is always good (Capitalisms mantra not mine).

There is a document surfaced on reddit, albeit I'm not sure how genuine it is (but who really needs to forge it anyway) "Eliminations of 379 positions", "Actual termination date" don't mean hour reductions for sure.
https://www.reddit.com/r/elderscrollsonline/comments/1uxg18d/official_breakdown_of_zoszm_positions_laid_off/

That some random internet document cites 379 and the official legally required notice states 213 should tell you all you need to know.

You mean a document from a FOIA request that directly states what everyone except you is claiming: that nobody was made part time and everyone was laid off.

This is public record. If you doubt a “random internet source,” you are free to send your own request to the Maryland Department of Labor so you can get it first-hand.

It states that 379 positions were eliminated. That doesn't mean there aren't re-hires into other divisions. We don't know what the re-structure looks like. You are taking something as gospel truth without knowing the full picture. Whereas I am pointing out you don't know the full picture. A restructure of a division, as part of wider company restructure at a company the size of XBox gaming, does not happen in a vacuum.

Gabriel_H wrote: »

FENGRUSH wrote: »

Gabriel_H wrote: »

FENGRUSH wrote: »

Gabriel_H wrote: »

Pixiepumpkin wrote: »

I have to imagine at some point the studio will need to actually produce a profit meaning labor will have to come down, meaning less employees or lowering their wages, except people in that area cant really afford to make less money.

The projections I have seen from those in the industry peg the net profit margin at over 70%.

We aren't getting any sort of source on this, are we?

You appear to have access to the same internet I do.

Yea and theres no financial data at all on the subject. Best piece people have is 2 billion over a decade. Absolutely no info on costs. More importantly, no accurate data on the last year or future projections on a game posting its worst numbers in the last 5 years.

Looks like youre throwing out best case scenario hopium and intending for it to be reliable information unless proven otherwise.

Here's a reliable piece or data - ESOs population has been in decline since post covid. Microsoft is reacting as such and readjusting this studio to better align with a future that focuses on large scale projects. Things like eso and f76 may in fact be making profit, but its not to the degree you've suggested.

The reality is the restructuring of all of these studios and solving a larger issue in the AAA dev space of bloated teams and a flatter management philosophy. If the entire studio went away tomorrow and eso with it, it doesnt really impact the new direction of the Xbox game divisions. ES6, new fallout - this is the future of the zenimax umbrella. Everything else is a stepping stone at this point.

... or you just don't know how to use google.

Lets go with basic math. $100k average salary. 250 employees. That's $25m a year in costs and the largest chunk of operating costs by far. Lets double that to account for server costs and tack some extra on for heat, light, stationary etc. That's $60m a year versus revenues of around $200m.

Edit: Oh and we have no idea about the state of player numbers. Just the Steam ones, and given some extrapolation from the NM event, they make up only around 25% of player numbers.

So youre estimating they only paid 250 people and using that as your baseline number. Despite the fact they just laid off 213 or so. I suppose theres only 37 people left as a whole in Maryland according to your math.

There's more accurate data you could find if you wanted and you'd realize they were employing much more than 250 people at just that location. Youre not accounting for anything else other than 'server costs'.

Zenimax media just lost over 100 jobs as well. Their parent holding company. How do you think these people were paid? Pats on the back? These are costs you have to factor in.

Bethesda softworks, their publishing arm. These are jobs, real people, that make the game function. They have an EU branch too. Zos having strong UK and Germany presence, how do you think those people are paid?

What about the Budapest office? Do they pay those devs too? Many big studios use eastern euro devs for animation because its cheaper labor. But they still are paid, and unaccounted.

How about sony/microsoft fees tied in to consoles sales over the years? Hefty 30% last I had seen, but that comes right off the top of 2 huge pools of revenue streams before any costs are factored. Im sure the Microsoft side is different now but it factors in on the budget.

Advertising campaigns for the publisher, legal endevours for zeni media, project blackbird expansion, paying over 300 QA in house and im not even factoring in external QA or outsourced dev/animation work. Localization, these are all yearly processes that never stop for a game like eso. Real people are paid and contracted to voice act, testers ensure it work, developers verify it ships functional to prod.

Ive been to zenimax HQ a few times and other large game studios. I can also not just use Google, but understand these game studios are a robust business, and ESO wasnt just a small studio on an island in Maryland making this game alone. Its been well supported globally by various teams and a very successful live service for a decade. It also had costs more than 'bout 5 mil a month.'

You have no idea of the costs. You take 2 numbers and divide one by the other and pretend you have any idea of the actual financial picture of ESO.

I wish the best for ESO, I love this game. But youre just making up stuff and gassing this forum out with hopium. You are not well informed, and youre not informative. You should not be taken seriously. Your bias is off the charts showing youre objectively compromised on this subject and youre at best a hopeful optimist.

Gabriel_H wrote: »

FENGRUSH wrote: »

So youre estimating they only paid 250 people and using that as your baseline number. Despite the fact they just laid off 213 or so. I suppose theres only 37 people left as a whole in Maryland according to your math.

I'm estimating current headcount.

Which doesnt make any of it better. Youre using old revenue stream estimates with a newly slashed budget number and assuming their profit margins with a completely stripped down studio, assuming revenue would be even remotely close to that previously.

Beyond that you aren't willing or able to address the real costs of the business I laid out in the post. Its not too late to admit you're wrong and dont really know what youre talking about.

Gabriel_H wrote: »

FENGRUSH wrote: »

Gabriel_H wrote: »

FENGRUSH wrote: »

So youre estimating they only paid 250 people and using that as your baseline number. Despite the fact they just laid off 213 or so. I suppose theres only 37 people left as a whole in Maryland according to your math.

I'm estimating current headcount.

Which doesnt make any of it better. Youre using old revenue stream estimates with a newly slashed budget number and assuming their profit margins with a completely stripped down studio, assuming revenue would be even remotely close to that previously.

Beyond that you aren't willing or able to address the real costs of the business I laid out in the post. Its not too late to admit you're wrong and dont really know what youre talking about.

The new revenue streams will have been designed to meet or exceed the old streams.

As for the rest of your post, I ignored it because it is irrelevant. You are talking about parent and sister companies to ZOS. That has very little impact on ESO, and if anything reducing the costs in those companies will make ZOS more profitable because the management charges that get passed back up the chain will be less.

Oh, and just to note: I have 30 years experience in finance including complex forecasting and revenue projections and corporate management including mergers, acquisitions, and restructures.

I bet you do. I suppose all the other people that make ESO what it is are volunteers. QA, publishers, legal teams, are 'irrelevant'.

Thanks for showcasing 30 years of finance.