Paradox Interactive Sees 90% Profit Decline Following Life By You Cancellation

Paradox Interactive has experienced a substantial 90% decline in profits, primarily due to the cancellation of Life By You. The company's second-quarter financial report, released on Thursday, revealed a significant drop in profits to $2.6 million, compared to $27.1 million in the same period last year. The write-down of Life By You's development costs, amounting to $19.2 million, was a major factor in the decline. Overall revenue also decreased by 22% to $53.3 million during the quarter. According to Paradox Interactive CEO Fredrik Wester, the decision to cancel Life By You was difficult, but necessary, as the game failed to meet expectations. Despite this setback, the company's core business has performed well, with successful expansions and a positive cash flow. However, the cancellation of Life By You and the subsequent closure of Paradox Tectonic, which affected 24 employees, has had a significant impact on the company's financials. Wester noted that the company has since adjusted its investment strategy to avoid similar high-risk projects in the future.