Devolver Digital's Resilience in Challenging Times

After experiencing significant highs in the industry since 2020, the current year has been particularly tough for game companies, with many shrinking, laying off staff, or closing down. Despite a healthy market with rising game sales, the atmosphere feels challenging. Even established indie companies like Devolver Digital have not been immune to these challenges, with the company's stock price plummeting and several releases postponed to next year. Devolver went public in November 2021 and has faced a difficult couple of years since. According to Graeme Struthers, COO and co-founder of Devolver, the company didn't realize it was entering a peak period when it went public. The launch of three major projects between November and May didn't yield the expected results, partly due to the massive success of Elden Ring, which consumed a lot of attention. However, 2022 turned out to be a 'banner year' for Devolver, thanks to the commercial and critical successes of Inscryption, Cult of the Lamb, Loop Hero, and Death's Door. Struthers notes that despite the company doing well, the market has softened, making it essential for Devolver to focus on its strengths in publishing video games. The appetite for games like Inscryption and Cult of the Lamb remains strong, and Devolver has a promising pipeline of indie titles, although some releases have been pushed to 2024. Struthers emphasizes the importance of polishing games to ensure they meet their potential, which sometimes requires delaying releases. The company's release slate for this year has not been empty, with titles like Terra Nil, Wizard with a Gun, Gunbrella, and The Talos Principle 2. With new indie publishers emerging regularly, Struthers doesn't think it's more challenging to sign titles or do their job as a publisher. However, the consolidation trend has had a greater impact on Devolver's business, with some developers being acquired by larger companies. This trend led to Devolver being approached by three different companies with acquisition in mind, ultimately contributing to the decision to take the company public. Struthers explains that going public seemed the best way forward, providing the necessary funds and ability to bring studios into the company.