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CD Projekt S.A.
Company typePublic
ISINPLOPTTC00011
IndustryVideo games
FoundedMay 1994;30 years ago(1994-05)
Founders
  • Marcin Iwiński
  • Michał Kiciński
Headquarters
Warsaw
,
Poland
Area served
Worldwide
Key people
  • Marcin Iwiński (Chair)
  • Michał Nowakowski (CEO)
  • Adam Badowski (CEO)
  • Piotr Nielubowicz (CFO)
Products
RevenueIncrease1.2 billionzł(US$308 million) (2023)[1]
Increase393.2 million zł (2021)[2]
Increase347.1 million zł (2021)[2]
Total assetsIncrease2.27 billion zł (2021)[2]
Total equityIncrease2.03 billion zł (2021)[2]
Owner
  • Marcin Iwiński (12.89%)
  • Michał Kiciński (9.99%)
  • Piotr Nielubowicz (6.87%)
  • Adam Kiciński (4.05%)[3]
Number of employees
Increase1,236 (As of 30 June 2022)[4]
Subsidiaries
Websitecdprojekt

CD Projekt S.A.(Polish:[ˌt͡sɛˈdɛˈprɔjɛkt]) is aPolishvideo game developer,publisherand distributor based inWarsaw,founded in May 1994 by Marcin Iwiński and Michał Kiciński. Iwiński and Kiciński were video game retailers before they founded the company, which initially acted as a distributor of foreign video games for the domestic market. The department responsible for developing original games,CD Projekt Red(stylised asCD PROJEKT RED), best known forThe Witcherseries, was formed in 2002. In 2008, CD Projekt launched the digital distribution service Good Old Games, now known asGOG.

The company began by translating major video-game releases into Polish, collaborating withInterplay Entertainmentfor twoBaldur's Gategames. CD Projekt was working on the PC version ofBaldur's Gate: Dark Alliancewhen Interplay experienced financial difficulties. The game was cancelled and the company decided to reuse the code for their own video game. It becameThe Witcher,a video game based on the works of novelistAndrzej Sapkowski.

After the release ofThe Witcher,CD Projekt worked on a console port calledThe Witcher: White Wolf;however, development issues and increasing costs almost led the company to the brink of bankruptcy. CD Projekt later releasedThe Witcher 2: Assassins of Kingsin 2011 andThe Witcher 3: Wild Huntin 2015, with the latter winning variousGame of the Year awards.In 2020, the company releasedCyberpunk 2077,a role-playing game based on theCyberpunk 2020tabletop game system for which it opened a new division inWrocław.

A video game distribution service,GOG,was established by CD Projekt to help players find old games. Its mission is to offer games free ofdigital rights management(DRM) to players and its service was expanded to cover newAAAand independent games.

In 2009, CD Projekt's then-parent company,CDP Investment,announced its plans to merge withOptimus S.A.in a deal intended to reorganise CD Projekt as a publicly traded company. The merger was closed in December 2010 with Optimus as the legal surviving entity; Optimus became the current incarnation of CD Projekt S.A. in July 2011.[6]By September 2017, it was the largest publicly traded video game company in Poland, worth aboutUS$2.3 billion,[7]and by May 2020, had reached a valuation ofUS$8.1 billion,making it the largest video game company in Europe.[8]In March 2018, the company joinedWIG20,an index of the 20 largest companies on theWarsaw Stock Exchange.[9]

History

[edit]

Founding

[edit]
Man in a T-shirt giving a talk
CD Projekt co-founder Marcin Iwiński in 2011
Former logo that was used until 2014

CD Projekt was founded in May 1994 by Marcin Iwiński and Michał Kiciński.[10]According to Iwiński, although he enjoyed playing video games as a child they were scarce inthen-communist Poland.Marcin Iwiński, in high school, was sellingcracked copiesof Western video games at a Warsaw marketplace.[11]In high school, Iwiński met Kiciński, who became his business partner; at that time, Kiciński was also selling video games.[12]

Wanting to conduct business legitimately, Iwiński and Kiciński began importing games from US retailers and were the first importers ofCD-ROMgames.[13]After Poland's transition to a primarilymarket-based economyin the early 90s, they founded their own company. Iwiński and Kiciński founded CD Projekt in thesecond quarterof 1994. With only $2,000, they used a friend's flat as a rent-free office.[11][12]

Localization

[edit]

When CD Projekt was founded, their biggest challenge was overcoming video gamepiracy.The company was one of the first in Poland tolocalizegames; according to Iwiński, most of their products were sold to "mom-and-pop shops". CD Projekt began partial localization for developers such as Seven Stars and Leryx-LongSoft in 1996, and full-scale localization a year later.[14]According to Iwiński, one of their first successful localization titles was forAce Ventura;whereas previous localizations had only sold copies in the hundreds,Ace Venturasold in the thousands, establishing the success of their localization approach.[15]With their methods affirmed, CD Projekt approachedBioWareandInterplay Entertainmentfor the Polish localization ofBaldur's Gate.They expected the title to become popular in Poland, and felt that no retailer would be able to translate the text from English to Polish. To increase the title's popularity in Poland, CD Projekt added items to the game's packaging and hired well-known Polish actors to voice its characters. Their first attempt was successful, with 18,000 units shipped on the game's release day (higher than the average shipments of other games at the time).[11][12]

The company continued to work with Interplay after the release ofBaldur's Gate,collaborating on a PCportfor the sequelBaldur's Gate: Dark Alliance.To develop the port, CD Projekt hired Sebastian Zieliński (who had developedMortyr 2093-1944) and Adam Badowski. Six months after development began, Interplay experienced financial problems and cancelled the PC version. CD Projekt continued to localize other games afterDark Alliance's cancellation, and received Business Gazelle awards in 2003 and 2004.[16]

CD Projekt Red

[edit]
The words "CD Projekt Red" appear right of a red-and-black bird
Logo used since May 2014

Enthusiasm for game distribution ebbed, and CD Projekt's founders wondered if the company should continue as a distributor or a game developer afterDark Alliance's cancellation. With the game cancelled and its code owned by CD Projekt, the company planned to use them to develop their first original game.[11][12]They intended to develop a game series based on Andrzej Sapkowski'sWiedźminbooks (which were popular in Poland) and the author accepted the company's development proposal. The franchise rights had been sold toMetropolis Softwarein 1997 and a playable version of the first chapter was made, but then left abandoned.[17]CD Projekt acquired the rights to theWiedźminfranchise in 2002. According to Iwiński, he and Kiciński had no idea how to develop a video game at that time.[12]

CD Projekt Red created a demo in a year. "It was a piece of crap," chuckles Adam Badowski. "We tried to convince Marcin and Michal not to go on the first business trip with the demo, but they decided..." to show it to a dozen publishers all around Europe on the most expensive and powerful laptop money could buy, Iwiński fills in. "After two weeks of meetings, we get two emails saying, in a very nice British way, 'It's not so good'. So pretty much: 'Boys, go home'. We were shattered. We were like, 'Oh my god we suck'".

— CD Projekt co-founder Marcin Iwiński, on publisher rejection of theWitcherdemo[12]

To develop the game, the company formed a video-game development studio (CD Projekt Red Sp. z o.o., headed by Sebastian Zieliński) inŁódźin 2002. The studio made a demonstration game, which Adam Badowski called "a piece of crap" in retrospect. The demo was a role-playing game with atop-down perspective,similar toDark AllianceandDiablo,and used thegame enginewhich poweredMortyr.[18]Iwiński and Kiciński pitched the demo to a number of publishers, without success. The Łódź office closed and the staff, except for Zieliński, moved to the Warsaw headquarters.[12]

Zieliński left the company, and Kiciński headed the project. Although the game's development continued, the demo was abandoned. According to CD Projekt, the development team had different ideas for the game and lacked overall direction; as a result, it was returned to the drawing board in 2003.[19][20]The team, unfamiliar with video-game development, spent nearly two years organising production.[13]They received assistance fromBioWare,who helped promote the game at the2004 Electronic Entertainment Expoby offering CD Projekt space in their booth next toJade Empire.BioWare also licensed theirAuroragame engine to the company.[21]

The game's budget exceeded expectations. The original 15-person development team expanded to about 100, at a cost of 20 millionzłoty.According to Iwiński, content was removed from the game for budgetary reasons but the characters' personalities were retained; however, there was difficulty in translating the game's Polish text into English.[22]Atariagreed to publish the game.[23]After five years of development,[13]the game broughtWiedźminto an international audience, and so the company adopted the English name,The Witcher,coined byAdrian Chmielarz.[a][17]The Witcherwas released in 2007 to generally positive reviews.[24]

Sales were satisfactory, and the development of sequels began almost immediately afterThe Witcher'srelease. The team began the design work forThe Witcher 2: Assassins of Kings,and experimented with consoles to develop a new engine forThe Witcher 3.Their development was halted when the team began work onThe Witcher: White Wolf,a console version ofThe Witcher.[12]Although they collaborated with French studio Widescreen Games for the console port, it entered development limbo. Widescreen demanded more manpower, money and time to develop the title, complaining that they were not being paid;[25]according to Iwiński, CD Projekt paid them more than their own staff members. The team cancelled the project, suspending its development.[26]Unhappy with the decision, Atari demanded that CD Projekt repay them for funding the console port development and Iwiński agreed that Atari would be the North American publisher of the sequel ofThe Witcher 2.[12]CD Projekt acquiredMetropolis Softwarein 2008.[27]

The dispute overWhite Wolfwas costly; the company faced bankruptcy,[28]with thefinancial crisis of 2007–08as a contributing factor.[12]To stay afloat, the team decided to focus onThe Witcher 2with theWitcher 3engine. When the engine (known asRed Engine) was finished, the game could be ported to other consoles.[29]To developThe Witcher 2,the company suspended development of Metropolis'first-person shooter,titledThey.[30]After three-and-a-half years of development,The Witcher 2: Assassins of Kingswas released in 2011 to critical praise[12]and sales of more than 1.7 million copies.[31]

AfterThe Witcher 2,CD Projekt wanted to develop an open-world game of a quality similar to their other games, and the company wanted to add features to avoid criticism that it wasWitcher 2.5.They wanted to push the game's graphics boundaries, releasing it only for the PC andeighth-generation consoles.This triggered debate on the team, some of whom wanted to release the game for older consoles to maximise profit.[12]The Witcher 3: Wild Hunttook three-and-a-half years to develop[13]and cost over $81 million.[12][32]A report alleged that the team had tocrunchextensively for a year in order to meet release date deadlines.[33]After multiple delays, it was released in May 2015 to critical praise.[34]Wild Huntwas commercially successful, selling six million copies in its first six weeks and giving the studio a profit of 236 million złoty ($62.5 million) in the first half of 2015.[35][36]The team released 16 freecontent downloadsand two paid expansions,Hearts of StoneandBlood and Wine.[37]The team decided thatThe Witcher 3: Wild Huntwould be the final game in the series with Geralt.[31][38]Regarding the future of theWitcherseries, Konrad Tomaszkiewicz, game director ofThe Witcher 3,stated in May 2016 that he hoped to continue working with the series sometime in the future, but had nothing planned at the time.[39]As of 2017, the series had sold over 33 million copies.[40]A spin-off of the series,Gwent: The Witcher Card Game,based on the popular card game inThe Witcher 3,was released in 2018.[41]

The success ofThe Witcher 3enabled CD Projekt to expand. In March 2016, the company announced that they had another role-playing game in development, and that the title is scheduled to be released in the period of 2017 to 2021. They also announced plans for expansion, where the Red division will expand two-fold.[42]It also listed itself atWarsaw Stock Exchange,riding on the success ofThe Witcher 3[citation needed].In March 2018, the opening of a new studio inWrocławwas announced. Acquired from a studio called Strange New Things, it is headed by formerTechlandCOO Paweł Zawodny and composed of other ex-Techland,IO Interactive,and CD Projekt Red employees.[43]In August 2018, CD Projekt established Spokko, a development studio focused onmobile gaming.[44]The Witcher 3's success as well as CD Projekt RED's customer-friendly policies during that period enabled the studio to earn a lot of goodwill within the gaming community. However, the studio's working conditions were questioned after disgruntled employees flooded the company's profile atGlassdoorwith negative reviews. Iwinski later responded by saying that the studio's approach to making games "is not for everyone".[45]

Following the successful release ofThe Witcher 3: Wild Hunt,Cyberpunk 2077,the studio's next title, became one of the most anticipated video games of all time.[46]It is an open-world role-playing game based on theCyberpunk 2020tabletop systemcreated byMike Pondsmith.The game was initially introduced in May 2012.[47]The hype for the title, alongside the release ofThe WitcherTV series onNetflix,enabled CD Projekt to become the most valuable video game company in Europe in May 2020, surpassingUbisoft.[48]The game suffered multiple delays, with the team stressing that they would not release the game until it was ready.[49]While management introduced a "non-obligatory crunch"model for the team to lessen the effects of game development on their personal lives,[50]management broke their promise and forced all developers tocrunchand work six days a week.[51]The game was released in December 2020. The PC version received generally positive reviews and became one of the biggest video game launches for PC. The development cost was fully recouped based on pre-order sales alone.[52]However, the console versions were plagued with technical issues and software bugs, with some players reporting that these versions were unplayable. The studio was accused of hiding the poor state of the console versions from its customers during the game's marketing. On 18 December 2020 the game was removed from the PlayStation online store.[53]Kiciński acknowledged that the company's approach to marketing the console versions eroded players' trust in the studio, and promised to release patches for the game.[54]

In early February 2021, CD Projekt Red was hit by aransomwareattack, with the attackers able to acquire the source code to several of the studio's games, includingGwent,The Witcher 3andCyberpunk 2077as well as administrative files.[55]The attackers demanded CD Projekt Red pay them a large sum of money within a few days under threat of leaking or selling the stolen code and files. CD Projekt refused to negotiate with the attackers, stating to the press that "We will not give in to the demands or negotiate with the actor", affirming no personal information was obtained in the attack and that they were working with law enforcement to track down the attackers.[56][57]Security analysts saw the code being auctioned on thedark webfor a minimum price ofUS$1 million,and subsequently closed later with the attackers stating they had received an offer that satisfied them.[58]Within a week of these auctions, the code was being shared online via social media, and CD Projekt began usingDMCAtakedown notices to remove postings of its code.[59]

In March 2021, CD Projekt Red acquired Vancouver, Canada-based Digital Scapes Studios and rebranded the studio as CD Projekt Red Vancouver.[60]In May, it was reported that Tomaszkiewicz had resigned from studio following workplace bullying allegations.[61]In October 2021, CD Projekt Red acquired Boston-based independent studioThe Molasses Flood,the developer ofThe Flame in the Flood.[62]

On 6 October 2022, CD Projekt announced a slew of new projects that were in the works. These included a sequel to Cyberpunk 2077, codenamed Orion, and several new titles in The Witcher series. These included a new trilogy of games, the first of which is codenamed Polaris, a standalone game known as Canis Majoris (later confirmed to be a remake of the first Witcher game[63]), and a single-player/multiplayer hybrid game from The Molasses Flood.[64]

In December, it was announced that active development on Gwent would end after 2023. Instead of shutting down completely, the game would be controlled by the community, allowing players to determine matters like balance decisions.[65]30 members of the Gwent development team were laid off in June 2023.[66]The game's final update was released in October 2023.[67]

On 20 March 2023, CD Projekt announced its intentions to write-off funds allocated to the development of Project Sirius, and that work would need to be restarted from scratch.[68][69]That May, 29 employees of The Molasses Flood were laid off once changes were made to Project Sirius.[70]In July 2023, CD Projekt CEO Adam Kiciński announced that they would be laying off around 100 workers—9% of its total workforce—from CD Projekt RED.[71][72]

REDengine

[edit]

REDengine is agame enginedeveloped by CD Projekt Red exclusively for theirnonlinearrole-playing video games.[73]It is the replacement of theAurora EngineCD Projekt Red had previously licensed fromBioWarefor the development ofThe Witcher.[74]

REDengine isportable across32-and64-bitsoftwareplatformsand runs underWindows.[73]REDengine was first used inThe Witcher 2: Assassins of KingsforWindows.[75]REDengine 2, an updated version of REDengine used inThe Witcher 2,[73]also runs underXbox 360[76]and bothOS X[77]andLinux,however these ports were made using acompatibility layersimilar toWinecalled eON. REDengine 3 was designed exclusively for a64-bitsoftware platform, and also runs underPlayStation 4,[78]Xbox One,andNintendo Switch.

REDengine 2 utilized middleware such asHavokfor physics,Scaleform GFxfor the user interface, andFMODfor audio.[79]The engine was used for the Xbox 360 port ofThe Witcher 2.[80]

REDengine 3 was designed to run exclusively on a64-bitsoftware platform. CD Projekt Red created REDengine 3 for the purpose of developingopen world[73]video game environments, such as those ofThe Witcher 3: Wild Hunt.It introduces improvements tofacialand otheranimations.[73]Lighting effects no longer suffer from reducedcontrast ratio.[73]REDengine 3 also supports volumetric effects enabling advanced rendering of clouds, mist, fog, smoke, and other particle effects.[81]There is also support for high-resolution textures andmapping,as well as dynamic physics and an advanced dialogue lip-syncing system. However, due to limitations on texture streaming, the use of high-resolution textures may not always be the case.[citation needed]

REDengine 3 has a flexiblerendererprepared fordeferredor forward+rendering pipelines.[73]The result is a wide array of cinematic effects, includingdepth-of-view,color gradingandlens flaresassociated with multiple lighting.[73]The terrain system in REDengine 3 usestessellationand layers varying material, which can then be easily blended.[73]

Cyberpunk 2077used REDengine 4, which supportedray-tracedglobal illuminationand other effects.[82][83]In March 2022, CD Projekt announced a partnership withEpic Gamesafter retiring REDengine to useUnreal Engine 5.[84][85][86]

Game distribution

[edit]
Main article:GOG
The words "GOG.com" appear in stylised lettering

In 2008, the company introducedGood Old Games,a distribution service with adigital rights management-free strategy.[14]GOG aims to help players find "good old games", preserving old games. To do so, the team needed to unravel licensing issues for defunct developers or negotiate with publishers for distribution rights. To recover old code for conversion to modern platforms, they had to use retail versions or second-hand games.[87]CD Projekt partnered with small developers and large publishers, includingActivision,Electronic ArtsandUbisoft,to broaden the service's portfolio of games to triple-A andindependent video games.[88]

Despite suspicions that it was a "doomed project", according to managing director Guillaume Rambourg, it has expanded since its introduction.[89]As of June 2015,GOG sold 690,000 units[90]of CD Projekt Red's gameThe Witcher 3: Wild Huntredeemed through the service, more than the second largest digital seller Steam (approx. 580,000 units[91]) and all other PC digital distribution services combined.[92]As of 8 July 2019, every thirdCyberpunk 2077digital pre-order was sold on GOG.[93]Income from GOG (known internally as CD Projekt Blue) accrues to CD Projekt Red.[12]

Subsidiaries

[edit]
Name Location Founded Acquired Notes
GOG Warsaw 2008 — Video game distribution platform
CD Projekt Red CD Projekt Red Warsaw 2002 —
CD Projekt Red Wrocław Wrocław 2018 —
CD Projekt Red Kraków Kraków 2013 —
CD Projekt Red North America[94] CD Projekt Red Vancouver Vancouver 2012 2021 Formerly Digital Scapes Studios[60]
CD Projekt Red Boston Boston 2022 —
The Molasses Flood 2014 2021

Former subsidiaries

[edit]
Name Location Founded Acquired Closed/Divested Notes
Metropolis Software Warsaw 1992 2008 2009 Closed
CDP.pl 2012 2014 Sold to the management, filed for bankruptcy in 2020
Spokko 2018 2022 Merged into CD Projekt Red[95]

Games developed

[edit]
Year Title Platform(s) Developer(s) Notes
2007 The Witcher Windows,macOS CD Projekt Red Enhanced Editionreleased in 2008
2011 The Witcher 2: Assassins of Kings Windows,Linux,macOS,Xbox 360 Enhanced Editionreleased in 2012
2014 The Witcher Adventure Game Android,iOS,macOS, Windows CD Projekt Red
Can Explode[96] 		—
2015 The Witcher Battle Arena Android, iOS CD Projekt Red
Fuero Games[97] 		—
The Witcher 3: Wild Hunt PlayStation 4,Windows,Xbox One,Nintendo Switch,PlayStation 5,Xbox Series X/S CD Projekt Red —
The Witcher 3: Wild Hunt – Hearts of Stone Expansion packtoThe Witcher 3
2016 The Witcher 3: Wild Hunt – Blood and Wine
2018 Gwent: The Witcher Card Game PlayStation 4,Windows,Xbox One,iOS, Android Spin-off of a card game featured inThe Witcher 3
Thronebreaker: The Witcher Tales Windows, PlayStation 4, Xbox One, Nintendo Switch, iOS, Android Standalone single-player game originally planned to be included inGwentasGwent: Thronebreaker[98]
2020 Cyberpunk 2077 PlayStation 4,Stadia,Windows, Xbox One, PlayStation 5, Xbox Series X/S —
2021 The Witcher: Monster Slayer Android, iOS Spokko[99][100] —
2022 Gwent: Rogue Mage PC, Android, iOS CD Projekt Red Standalone single-player expansion toGwent[101]
Roach Race Android, iOS CD Projekt Red
Crunching Koalas 		Also released as an arcade minigame inCyberpunk 2077via DLC
2023 Cyberpunk 2077: Phantom Liberty PlayStation 5,Windows,Xbox Series X/S CD Projekt Red Expansion packtoCyberpunk 2077[102]
TBA The Witcher Remake TBA Fool's Theory Remake ofThe Witcher(2007), developed using Unreal Engine 5[103]
Project Hadar CD Projekt Red CD Projekt's first original IP
Project Orion CD Projekt Red North America Sequel toCyberpunk 2077[104]
Project Polaris CD Projekt Red First game in a new trilogy set inThe Witcheruniverse, developed usingUnreal Engine 5[105]
Project Sirius The Molasses Flood
CD Projekt Red North America 		New game set inThe Witcheruniverse featuring multiplayer[106]

Business views

[edit]

The moment we start becoming conservative [and] stop taking creative risks and business risks, and stop being true to what we're doing, that's when we should worry. And I am not worried. Our values and our care for what we are doing and – hopefully what gamers would agree with – care for gamers is what drives this company forward. It's my personal horror to become a faceless behemoth of game development or publishing or whatnot. As long as I am here I will be fighting for this not to happen.

— CD Projekt Red founder Marcin Iwiński, on maintaining independence[107]

The company claims to focus on certain aspects and features of a game at a time, in order to ensure quality.[108]The company focuses on the development of role-playing games, with the team working on established franchises with a fan base and introducing lesser-known franchises to a wide audience.[109]The studio has been praised for prioritising quest design over the size of the game world in its open-world games.[110]

CD Projekt Red opposes the inclusion ofdigital-rights-managementtechnology in video games and software. The company believes that DRM is ineffective in haltingsoftware piracy,based on data from sales ofThe Witcher 2: Assassins of Kings.CD Projekt Red found that their initial release (which included DRM technology) was pirated over 4.5 million times; their DRM-free re-release was pirated far less.[111]The Witcher 3: Wild HuntandCyberpunk 2077were released without DRM technology.[112]The team believes that free downloadable content should be an industry standard. The company demonstrated this by releasing several free DLC forWild Hunt.[113]

According to Studio Head Adam Badowski, CD Projekt Red avoided becoming asubsidiaryof another company in order to preserve their financial and creative freedom and ownership of their projects.[114]In 2015,Electronic Artswas rumoured to be attempting to acquire CD Projekt, but this was denied by Iwiński who said that maintaining the company's independence was something he would be fighting for.[107]Financial details on development, marketing and release costs are freely published, citing being "open in communication" as one of the company's core values.[115]

The company used to followRockstar Games'business model,where the company works on a single project with a large team and avoids working on multiple projects at the same time.[116]In March 2021, they changed their strategy. From 2022 onward, they will work on multiple AAA games in parallel.[117]

Controversy

[edit]

In December 2021, CD Projekt agreed to pay $1.85 million while negotiating to settle a class-action lawsuit over the problematic release ofCyberpunk 2077,a game which had several technical issues that many users experienced.[118][119][120]

References

[edit]
  1. ^Chmielarz's claim to the term "Witcher" is disputed by Sapkowski in the latter's 2005 book-interview (seeThe Witcher§ The name "Witcher")
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