Cloud Imperium Financials for 2021


It is that time of year again when we follow our usual practice to set out our basic accounting for the 2021 Financial Year. For consistency, I am adopting the same format as prior years and follow the same simple cost accounting rules, without the requisite formats and disclosures required in our financial statements. There are no revenue recognition adjustments, intellectual property amortization or other accounting adjustments that would depart from the more simple and understandable cash entries that this accounting is aimed to deliver.

The Accounting is intended to be simple and understandable, showing “income,” net of sales taxes, as invoiced or accrued, and costs as incurred whilst adding capital expenditure as “spent.”

As usual, we aim to give more information regarding how the income and revenue is classified compared to what we would be required to do in published financial statements, and the numbers used in the analysis are the same numbers given to our auditors, upon which they perform their work for the annual audit.


The 2021 accounting shows that Cloud Imperium grew again with total income up 14% on the record-breaking 2020 reviewed last year. As explained last year, 2020 was exceptional due to the worldwide lockdowns that created a new audience craving an entertaining and escapist outlet, with limited choices available due to the restrictions. We were fortunate and well-positioned to be able to engage this new audience in 2020. But in 2021, without those same lockdown-induced factors, whilst growth this year was not as dramatic, the ability to continue growing above and beyond the 2020 performance was an even bigger achievement than the prior year, and one that several other video game companies did not achieve. The regular and improving game deliveries and increased content and playability was a key part to our success in 2021, particularly during the second half of the year, and this momentum has continued into 2022, with even more focus on stability and quality of life fixes for this early access game.




2021 was another record year for income with sales, up 12% to $86M. As a result of the record number of new players joining the game, and existing and lapsed players returning to the game due to the strong content delivery throughout the year, we experienced a commensurate rise in purchases of starter packs that granted early access to the Star Citizen Alpha, as well as purchases of ships and digital items for immediate use in the Persistent Universe. Subscriptions were up 6% to $5M. Other income increased 45% to $9.4M, in part driven by the associated local incentives programs resulting from the growth of development staff in the UK.

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

Pledges / Sales (from Counter)

This line is taken directly from our daily published Funding Stats Counter, showing the net receipts from our backers and customers. The vast majority of sales are of starter pack sales granting access to the Star Citizen Alpha, as well as space ships and digital items immediately delivered and playable in the game. A smaller fraction of sales came from pledges for concept ships, which all come with an included “loaner” ship for immediate use and playability within Star Citizen Alpha. Due to exchange differences and small items that are not included in the counter, such as shipping costs charged 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 five broad categories.


Cloud Imperium continued to grow throughout 2021. Costs increased by 32% over 2020 to $98.5M although capital expenditure, at $2.0M, was down 68% on 2020, as the prior year included the strategic purchase of the perpetual CryEngine license as previously reported. The breakdown of the expenditure is commented upon in more detail below. 2021 was a hybrid year with continued work from home for long periods before we managed, in-part, to return to the office during the second half of the year. The Rest of the World operations grew appreciably in 2021 necessitating new and upgraded offices and facilities for those teams, which began in 2021 but will impact more in 2022 and beyond.

The US remained about the same size, as the publishing, community, and marketing teams grew while our internal development teams contracted, as they managed more external development resource.

The costs of servicing the growing customer base referred above and the costs associated with driving income growth increased this year with ongoing investment into support and security with an eye on future requirements. This investment in growth delivered appreciable dividends in 2021, not only by way of our increased revenue growth, but also in our year-over-year growth in new paying players, further enlarging our customer base and affording us the ability to re-invest into our development efforts, thereby improving our ability to deliver against the ambitious vision of our games.

Salaries and related on-costs

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

This shows that salary costs increased in both territories, although mainly in the Rest of World territories where it was up 24%. Development and general and admin headcount increased in the Rest of the World by 11%, although as reported last year most of the increase in Rest of World headcount was only towards the end of that year and thus the costs did not reflect the headcount numbers shown at the end of 2020. Hence the increase in costs in 2021 represents not only the increased headcount from 2020 but also the full year cost of many of those people added only towards the end of 2020 with added general inflationary pressures and wage competition.

In contrast, the US Development headcount decreased by 8% as internal production gradually shifted to the Rest of World territories. Much of the US headcount reduction was not based on policy, but through natural wastage with positions vacated in the US being filled elsewhere. Indeed, as referenced last year, the pandemic situation has created more employee turnover than usual, worldwide, but particularly in the US. The timing of the US headcount reduction, with more towards the end of the year, and the ongoing and rising wage competition stimulated by general inflation pressures has meant despite the US headcount reduction, salary costs were still 4% up on the prior year.

Other game development costs (overheads)

Other game development costs represent 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. In 2021, this category increased by 34% to $11.7M, but this was from an unusual low in 2020 arising from the Pandemic lockdown and work from home regulations, which meant our offices were largely empty. Travel and office activity increased towards the end of 2021 and was intensified to make up for the collaborative time lost during the lockdowns. Just as the Rest of the World (with the most employees and therefore the most travel and office-based costs), was primarily accountable for the fall in costs in this category in 2020, it was primarily responsible for the growth in 2021 with a 38% increase to $6.4M in 2021. The US increased by 29% to $5.3M.

With the growth in headcount outside of the US, it has been necessary to expand our offices in the Rest of the World to accommodate people now working in the business and further planned growth anticipated. Consequently, the Rest of World costs in this category are likely to rise more into 2022 and beyond as we have upgraded our premises in these territories to create tremendous destination spaces for our employees to return to work, collaborate and socialize together.

Contracted Game Development Costs

These represent the costs of contracted services supporting game development work. For 2021 this increased by 56% to $8.65M. External services used by the Rest of the World dropped by 22% to $2.5M as it continued its trend of internalizing the development resources deployed on the games. However, US spend in this area was up by 161% ($3.8M) mainly arising from managing a growing development team based in Canada. This represents the continuing trend in the US of supplementing its core development specialists with external development talent from elsewhere.

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, customer liaison costs, and the costs of our marketing and community events, although, like 2020, these were curtailed in 2021 due to pandemic restrictions. This cost line correlates closely with income and user engagement, and the growth experienced in 2020 accelerated further in 2021, rising 66% to $25.4M.

The bulk of the publishing (Austin) and marketing (Los Angeles) operations are run from the US so it is not surprising that this accounts for 70% of the spend in this area. Those departments grew again in the US adding 14% to the associated headcount in 2021. However, the Rest of the World also increased headcount in these disciplines by 12% and as we expand our presence worldwide, we must continue to address our growing international customers with their myriad of diverse requirements. We continue to invest heavily into our platform and community tools to make the interactive Star Citizen experience as smooth, safe, and enjoyable as possible.

General and Admin

These costs represent insurances, accountancy, and other professional and legal fees not apportioned directly into the cost areas identified previously. Although corporately led, they are in part driven by the growth in the operations of the group, hence the increase in 2021 and particularly in the Rest of the World, which grew the most in this year.

Capex and Investments


This represents capital expenditure in areas such as hardware and software, fixtures, fittings, and on offices. Whilst it trends with staff numbers, it is also impacted by hardware renewals, server upgrades and other security and infrastructure purchases. It is included in this accounting as it represents an outlay for the materials required to develop and publish the games. Since the total capital expenditure amount is included here, we do not list the depreciation portion of such expenditure subsequently in the cost analysis.

Capex spending in 2021 was $2.0M and was mainly concentrated in the Rest of World territories which grew most during the year. This was $4.1M less than 2020, although the prior year was dominated by the one-off strategic purchase of a perpetual worldwide license for use of the CryEngine. Next year, capex will increase as the world-class offices are fitted out and come fully on-line.

Headcount Analysis



The headcount analysis represents the people working at the end of the year under the broad disciplines identified. (Note: It is not average people numbers for the year).

Employee numbers increased by 53 (8%) to 748 worldwide by the end of 2021. The US headcount only increased by one but this represented a rise in publishing, marketing and community headcount (+14%) equivalent to the reduction in development headcount (-11%), as the US focused on core development activities whilst managing more external development. The Rest of the World headcount grew by 12% in both development and publishing, marketing, and community functions. By the end of 2021, the Rest of the World represented 70% of the total internal headcount of the Group.



The 2021 Accounting shows the Group continued to spend its income on the ongoing development and publishing of the games, as has been the intention from the outset in its goal to deliver a world class gaming and unique social experience for its players and community. The minority investment funds sitting on the balance sheet remain earmarked for future marketing activities as we approach the commercial launch of the games. They also serve the additional purpose of providing financial security to allow longer-term strategic planning, evidenced by the substantial long-term commitment to the upgraded office facilities in the Rest of the World locations made in 2021. These upgrades are not just to accommodate the increased headcount but are designed to create a world-class place for collaboration and innovation.

At the time of writing, I am pleased to report that 2022 has also gone very well. We eclipsed our total 2021 income performance well before the end of the year and are set for another record-breaking year. We are on target to substantially beat our net budgeted position by the end of 2022, despite the increased team sizes and costs fueled by global inflation plus our own demanding requirements to deliver on our aims for 2022. However, we are far from complacent, operating in a highly competitive environment, where shocks to the system such as the COVID-19 Pandemic followed by the conflict in Ukraine show that nothing is predictable, and we must remain vigilant and focused upon our objectives. We have a tremendous team driven by incredible support from our community and customers and continue to aim to deliver an amazing experience for them which improves with every year and delivery as we progress towards our ambitious vision and aspirations.

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