Palworld's profits could be over $130 million

Pocketpair could have made over $130 million profit on Palworld.

3

Palworld, the smash-hit indie sensation that's taking over gaming, has become wildly successful with 6 million sales in 4 days. It's not just sales volume and revenue that's envied by billion-dollar publishers, though. Palworld also enjoys an incredibly high profit margin.

According to our calculations, Pocketpair could have made $130 million of profit on Palworld's game sales. Reports indicate that Palworld had a production budget of 1 billion yen. That's roughly $6.7 million in current yen-> USD exchange rates. For context, big-budget AAA games often have budgets in excess of $100 million, and these projects can go on to sell around 4-5 million copies and be considered a success.

• Read more: MachineGames financials reveals Indiana Jones developer has 6% profit margin
• Read more: Report: Xbox targeting 30% profit margin amid layoffs, restructuring, and AI adoption
• Read more: Microsoft says Xbox not targeting 30% profit margin, refuting reports

3

So...how did we get this figure?

For the purposes of the calculations, I calculated the numbers as if Palworld was exclusively available on Steam. This was the best course of action considering there's so much we don't know about the Xbox version. We don't know the exact sales volume split between the two platforms, and we also don't know Microsoft's exact revenue split with Pocketpair. Sometimes, developers can negotiate more positive revenue splits with Microsoft, Nintendo, and Sony.

At 6 million sales at $30 a piece, Pocketpair's Palworld has generated around $180 million in sales revenue. Of course, platform-holders like Valve and Microsoft will take their commission fees. Valve's fees get lower the more money that a game makes, and we've included that in our estimations.

One big thing to keep in mind is that this money may be converted from USD to Japanese Yen because Pocketpair is located in Japan.