After Life by You's disastrous end, Paradox chalks up a 90% drop in operating profit for Q2: 'We end the second quarter of the year with mixed feelings'

It's been a rough time for Paradox. Bloodlines 2 has been a (wrong kind of) nightmare, it cut ties with Harebrained Schemes after Lamplighters League underperformed, Cities: Skylines 2 came out with a raft of tech bugs, Millennia disappointed, and, of course, the company totally canned its Sims competitor Life by You and shuttered the studio making it.

So it's not surprising that the company's Interim Report, released today, contains the kind of news that will make you suck air through your teeth. The good news? The company was still operating at a profit in its second quarter, which lasted from April 1 to June 30 this year. The bad news? It was only by the skin of its teeth, and only really thanks to its homegrown stalwarts—CK3, Victoria 3, Hearts of Iron 4—rather than any of the risks it's taken in the last few years. Though Age of Wonders 4, from Triumph Studios, has also done well for Paradox.

The headline number is a decrease in operating profit of 90%, from 293 million Swedish krona ($27 million) in the second quarter of 2023 to a mere 37 million krona ($3.4 million) in 2024's. That's mostly down to—you guessed it—the cancellation of Life by You and the write-down of its development costs, which hit Paradox for some 208 million krona ($19.2 million). Paradox's profit for the quarter after tax and other «financial items» was 27 million Krona ($2.5 million), down 88.5% on last year's second quarter.

I'm no financial whizzkid, but none of that sounds like a direction you want your company's finances to trend in, and it sounds like Paradox CEO Fredrik Wester agrees. In comments accompanying the report, Wester says «We end the second quarter of the year with mixed feelings,» which feels like a very delicate way to put it. «On the one hand, our core business has performed very well, but on the other hand, we made the difficult decision to cancel the release of Life by You, as the game would not be able to meet our expectations.»

It really sounds like Wester, who