Cloud Imperium Financials for 2019

It is that time of year again to set out our Accounting for the 2019 Financial Year, adopting the same format as prior years and following the same simple cost accounting rules. This means without the requisite formats and disclosures required in our financial statements and without revenue recognition adjustments or intellectual property amortization entries.

The aim of the Accounting continues to be simplicity and understandability for the average reader, showing “income,” net of sales taxes, as invoiced or accrued, and costs as incurred, adding capital expenditure as “spent.”

But using the numbers our auditors have reviewed and verified as part of their audit work relating to this financial year.


The 2019 accounting shows Cloud Imperium continued on its growth path with another record-breaking year for new customers and community engagement. The additional security afforded by the minority investment received in 2018 allowed the group to plan and invest more for the future with a much needed upgrade of its UK offices and the acquisition of a minority stake in Turbulent Inc, Star Citizen’s Online and Publishing platform partner, to further strengthen and secure that relationship. 2019 saw an increase in the “nuts and bolts” infrastructure of the business to accommodate the planned growth, and a step up in the Community and Marketing operations, particularly in the UK, with a very successful CitizenCon being held there this year.

Towards the end of the year, the 2018 investors exercised their pre-agreed option to extend their investment, adding a further $17.25M to the Group’s reserves to pave the way for further expansion and funds to market and promote the ground-breaking projects we are undertaking.




2019 was another record year for income with pledges up 26% to $47.6M and subscriptions up 12% to $3.6M. Other income was 20% higher than 2018 at $9.5M, providing a pledges and income total of $60.7M, $11.8M (24%) up on the previous year.

To recap: the top three lines describe our revenue sources:

Pledges / Counter

This line is taken directly from our daily published Funding Stats Counter, showing the net receipts from our backers and customers. However due to exchange differences and small items that are not included in the counter, such as collected shipping costs on physical goods, the counter does not completely represent all revenue received. Other than subscriptions (referred below) these differences are included in the final income line, to give an accurate representation of total revenue received.


The subscriptions line is the value of our subscriptions using standard exchange rates. Again, any differences due to exchange rate movements have been accounted for in the final income line.

Other income

The other income line represents partnership income with various hardware and software vendors, sponsorship income, and various local incentives based upon the nature and location of our development and production activities. It also includes any exchange differences as referred above.

Trading Costs


Trading costs are broken down by territory and year into 5 broad categories.


In 2019, Cloud Imperium continued on its steady growth path. Income increased by 24% year on year but costs before capex were also up 23% and capex more than doubled as the Company continued to invest into the business, growing its development and content delivery whilst also investing into its G&A and infrastructure to prepare itself for the plans ahead.

It engaged and managed more third-party developers to accelerate and enhance the content being created and continued to grow the Publishing and Marketing side of the business as it reached out to and serviced more and more diverse international customers.

Salaries and related on-costs

Salaries and related on-costs represent the total employee cost within the Group, excluding Community and Marketing personnel – whose salaries and related costs are included within their associated cost line.

This shows that salary costs increased in both territories, by 27% in the US and by 12% in the Rest of World territories. Non-marketing headcount increased in both territories by just over 16% but with principally senior hires and intense wage rise competition in the US pushing that increase up compared to the relatively more junior and G&A hires made in the Rest of the World. The difference was also exacerbated by the higher cost of living increases experienced in the US that were compensated for through pay increases during the year.

Other game development costs (overheads)

Other game development costs, representing the costs of operating the various studios and including such expenses as office rental and maintenance, travel and accommodation, IT, and other costs not included elsewhere, increased by 17% to $8.9M. The Rest of the World, and particularly the UK operations, were responsible for the majority of this growth, up 29%, representing the majority of the group’s development operations and enjoying a much needed upgrade in its office environment and infrastructure to accommodate growth to date and preparing for future plans. US development overheads increased by a modest 5%, satisfyingly low given the increase in US personnel during the year.

Contracted Game Development Costs

These represent the costs of contracted services supporting game development work. Although unsurprisingly the Rest of the World continued to engage the majority (74%) of these services, expansion of the US development team facilitated more engagement with external services in the US to complement the internal resources being deployed. Rest of World contracted services increased by $1M to $4.2M whilst the US spent $1.5M on contracted services.

Publishing Operations, Community, Events and Marketing

These costs are associated with running the game, deploying online services and providing customer support. It also includes the costs of running our platform, publishing, data hosting and server costs. It includes sales collection and customer liaison costs and the costs of our marketing and community events. As such this cost line moves directly with income and unsurprisingly showed a large growth in 2019, up 26% to $11.4M. The composition shifted significantly with the UK-hosted CitizenCon and relative growth in Rest of World customers pushing that territory’s costs up substantially, to account for 34% of the total spend in this category, compared to only 20% last year. Although Austin remains the center of publishing operations and LA the center of marketing operations for the group.

General and Admin

These costs represent insurances, accountancy and other professional and legal fees not apportioned directly into the cost areas identified previously. They are in part driven by the growth in the operations of the group and following the minority investment in 2018 have been strengthened with the introduction of tighter governance, increased insurance, and professional advice into the increased compliance overhead arising from the multinational growth of the group.

Capex and Investments


This represents capital expenditure in areas such as hardware and software, fixtures, fittings, office refurbishment and build out. It is heavily influenced by staff numbers and hardware renewals as well as server upgrades and other infrastructure costs required for the efficient deployment of the game.

Whilst this is capital in nature, it is included in this accounting as it represents an outlay for the materials required to develop and publish the game. Since the total capital expenditure amount is included here, we do not list the depreciation portion of such expenditure subsequently in the cost.

Capex spend in 2019 was significantly up on 2018, which itself was comparatively low, particularly in the Rest of World territories, compared to prior years. Capex was one of the primary areas targeted following the minority investment in 2018 and whilst US expenditure was consistent around the $400k level, there was a dedicated move to upgrade the Rest of World, and specifically UK, hardware and infrastructure with $1.1M spent on this in 2019. $0.9M was also spent on investments including acquiring a minority stake in Turbulent Inc, Star Citizen’s Online and Publishing platform partner, to further strengthen and secure that relationship.

Headcount Analysis



As before, the headcount analysis at the bottom of the accounting represents the people working under the noted disciplines as at the end of the year. It is not average people numbers for the year.

Employee numbers increased in 2019, up 83 (16%) on 2018 to finish the year at 604. The comparative split by territory was proportionately similar but with the US increasing its development representation whilst the Rest of the World increased its Marketing and Publishing and G&A presence.



The 2019 Accounting shows the Group continues to push forward on all fronts, buoyed by the minority investment in the prior year, which has allowed it to plan longer term and invest in important areas that support the growth ahead. The Group has continued to deliver steadily improving builds each quarter throughout the year, and this has attracted more and more people into the ecosphere, who, once engaged, fully participate in the unique product being developed.

At the time of writing, I am pleased to report that 2020 has gone even better than 2019. The planned growth that we were investing for in 2019 has in part materialized in 2020, and thanks to the investments made in 2019 we were better placed to cope with that growth. 2020 will again be another record-breaking year for us, and whilst we recognize it has been a difficult year for many in so many different ways, we hope that with the continued support and backing of our community we will provide some welcome entertainment and escapism to our customers with an experience that grows better and better each year.

Simon Elms, Chief Financial Officer
December 23, 2020

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