CD Projekt SA (OTGLF): Has Cyberpunk 2077's Success Cemented a New Era for the Studio?

The launch of Cyberpunk 2077 in 2020 was a double-edged sword for CD Projekt SA. While the game's initial reception was marred by technical issues and a subsequent stock collapse, the title has since become a cornerstone of the company's post-2023 recovery. By 2025, Cyberpunk 2077 and its Phantom Liberty expansion had sold over 35 million units, with the latter surpassing 10 million copies in just two years. This success has driven a 53% year-over-year revenue surge in Q3 2025, with sales reaching 349 million PLN according to company reports. Yet, the question remains: has this success translated into a sustainable new era for CD Projekt, or is the studio still navigating the long-term fallout of its most ambitious project?

Revenue Growth: A Mixed Picture

CD Projekt's financial performance in 2025 reflects both resilience and fragility. The first half of the year saw a 4.3% increase in sales revenue to 443 million PLN, driven by Cyberpunk 2077 and The Witcher 3's continued sales now over 60 million units. The Nintendo Switch 2 physical release of Cyberpunk 2077 further bolstered revenue, with 75.4% of unit sales in that format. However, this growth was offset by a 7.7% decline in net profit to 155 million PLN, attributed to higher tax burdens and development costs exceeding 240 million PLN for upcoming projects like The Witcher 4 and Cyberpunk 2 according to earnings reports.

Q3 2025 marked a turning point, with revenue jumping 53% to 349 million PLN and net earnings reaching 193 million PLN-a 2.5x increase year-over-year according to company data. This was fueled by Cyberpunk 2077's inclusion in PlayStation Plus subscriptions and the Phantom Liberty expansion's momentum. Yet, the company's reliance on a single title remains a risk. As one analyst notes, "While Cyberpunk 2077 is a cash cow, its long-term profitability depends on sustaining player engagement through expansions and cross-platform availability" according to financial analysis.

Profitability Challenges: Balancing Investment and Returns

Despite strong revenue, CD Projekt's profitability has been strained by its ambitious development pipeline. The Witcher 4 team expanded from 422 to 444 developers in 2025, while Cyberpunk 2 remains in preproduction according to earnings updates. Development expenditures for H1 2025 alone exceeded 240 million PLN, reflecting the company's commitment to long-term projects according to financial reports. While EBIT rose 20% year-over-year to 168 million PLN, net profit fell 9% due to accounting adjustments and increased selling costs according to market analysis.

The company's financial flexibility, however, remains robust. As of September 2025, CD Projekt held 1.408 billion PLN in cash and equivalents, enabling it to fund share buybacks and dividends while maintaining liquidity according to company announcements. This positions the studio to weather near-term profit volatility, but the absence of a major new title until The Witcher 4 (expected post-2026) raises concerns about revenue continuity according to financial reports.

Future Pipelines: Diversification and Strategic Shifts

CD Projekt's long-term sustainability hinges on its ability to diversify beyond Cyberpunk 2077. The studio is developing seven new projects, including Project Hadar (a new IP), The Witcher 4 (a trilogy), and Cyberpunk 2 according to strategic planning. The Witcher trilogy, in particular, represents a strategic pivot: the first game is expected in 2027, with subsequent titles spaced two years apart according to industry reports. This staggered release model aims to maintain revenue streams while mitigating the pressure of delivering a single, high-risk title.

The company is also expanding into non-gaming media, such as films and comics, through its "franchise flywheel concept." Cyberpunk: Edgerunners on Netflix has already demonstrated cross-media potential, and CD Projekt plans to license IPs to third-party developers for mobile and non-core games according to strategic updates. These moves signal a shift from a "studio of one" to a diversified entertainment brand.

Risks and ESG Considerations

Despite these efforts, CD Projekt faces significant risks. The stock's 75% drop post-Cyberpunk 2077's launch has yet to fully recover, and investor confidence remains fragile according to market analysis. Market competition from studios like Techland and shifting consumer preferences toward convenience-driven gaming (e.g., mobile and cloud gaming) could further strain profitability according to industry trends.

On the ESG front, the company has strengthened its sustainability strategy, including carbon neutrality goals and ethical sourcing practices according to company updates. However, its S&P Global ESG Score lags behind industry peers, and regulatory pressures like the Corporate Sustainability Reporting Directive (CSRD) may increase compliance costs according to compliance reports.

Conclusion: A New Era, But with Caution

Cyberpunk 2077 has undeniably revitalized CD Projekt's financials, but the studio's long-term success depends on executing its ambitious pipeline and adapting to industry trends. The Witcher 4 trilogy and Cyberpunk 2 offer a path to sustained revenue, while diversification into media and partnerships reduces reliance on AAA titles. However, development delays, market competition, and ESG challenges remain critical risks. For investors, the key question is whether CD Projekt can balance its creative ambitions with financial discipline-a lesson it learned the hard way after 2020.