SoftBank-Backed Improbable's Losses Increase Ten-Fold in a Year
(Bloomberg) -- Improbable Worlds Ltd., a London-based software startup backed by Japan’s SoftBank Group Corp., has seen revenue plummet and losses balloon, according to the company’s latest financial filings.
Sales for the year ended May 2018 were 579,859 pounds ($756,800), down from 7.8 million pounds a year earlier, documents posted to U.K. business registry Companies House on March 6 show.
Pre-tax losses increased more than ten-fold to 50.4 million pounds, up from 4.9 million pounds in 2017. The company has also continued to hire at a rapid clip: it had 222 employees for the period, up from 135 a year earlier. As a result, staff compensation costs more than doubled.
Improbable makes software that lets customers build large and complex simulations. Clients have included the U.S. Army, but the company said its core business was targeted at video-game developers and the products they release.
In a statement Friday, a spokesman said Improbable’s commercial progress was not reflected by sales, and that "spikes in revenue will occur along the way related to specific contracts."
"We are where we expect to be at this stage of our growth phase," the spokesman said. "We are spending money in order to build the team and the technology required to realize success in the future."
In May 2018, London-based Bossa Studios, an independent game development firm, released Worlds Adrift, the first title to be created on Improbable’s SpatialOS platform.
The company is no danger of running out of money, however, thanks largely to SoftBank’s $500 million investment in May 2017. As of May 31, 2018, Improbable had about 255 million pounds in cash and cash equivalents on its balance sheet. In July 2018, Chinese gaming firm NetEase Inc. also invested $50 million in the company.
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