The refund rate is 1.39%, GOG reserve the right to refuse refund requests in case of abuse, and pirates don't need to ever pay for the game in the first place.

GOG alone made a record profit in 2020 (around 20,5 million PLN, that gives us around 5,2 million USD). What more there wasn't a single year in history of the company with a loss in the financial results. So GOG is profitable. It has however quite high operating costs, a something we tried to figure out on the Polish forums some time ago. It's possible that the servers eat a large portion of the sales revenues (which almost constantly grow year to year, a very good sign). Additionally I have suspicions that GOG might be paying some of the publishers to be able to sell their games. The main question is whether those 20 million PLN will be invested in the future of the platform or rather spent on something else. Anyway, right now GOG is in a good condition (despite the loss in the first quarter of 2021).

The first graph shows sales revenues in PLN year to year. The second one profit year to year.

Diversity and sensitivity training.

We saw updates to Galaxy earlier this month. Not substantial, but still supporting it.

2020 Management Board Report (p.102)
- 71% of all their revenue is part of direct selling costs (i.e., 70% cut to gamedevs) - the offset with CDPR games sold is probably bizdev, repackagers, and server costs
- 22% are indirect operating costs: marketing, Galaxy development, overhead, external services, maybe giveaways
- 1% taxes
- 6% is net profit goes to shareholders, dividends, bonuses, etc.

Maybe a finance or stocks guy can help explain the rest of the numbers to give more insights.

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On profit and growth:

According to the Kawasaki Matrix, GOG's games are 'valuable', but 'not unique', so they have to compete on margin and volume sales to stay in the black. DRM-free is valuable to us, but other Steam and EGS folks either haven't heard of it, erroneously believe they own a license of their games, or don't consider it important enough to them to be 'valuable'. And I highly suspect here won't be a huge shift in adoption until DRM burns them AND they overcome sunk cost fallacy.

I don't foresee user base or revenue to grow significantly unless GOG starts doing [timed] exclusives or until EGS fails. Since we're probably seeing a limit to how much its users will evangelize GOG's reputation through positive word of mouth.

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Pirate providers likely do keep their games and use donations and/or ad revenue to subsidize others for their game releases so the system can't catch them. You'd have to be shortsighted to refund all the library games you're going to upload and trigger their report abuse systems. Or if not, then they'd have to be doing it from throwaway accounts. There's plenty of ways to circumvent their checks through social engineering / system abuse.

LOL

You are absolutely right. Funny thing is that even Steam cracks of the same games have way better torrent representation than already DRM free Gog versions. Not with every game but in general Steam games are pirated way way more.

Makes sense, if it's the only way to play the game you want without the accompanying steam malware.

It's an educated guess, but I'd say they go on purchasing high-grade organic honey. You know, for the GOGBears :P.

As toxicTom said, GOG appears to be too busy defending Poland's damnable sense of Nationalist Pride instead of ascribing to just hiring internationally like a sane company would.

What is a GOGBear?

If you ever have a GOG web page fail to load for some reason, you see the GOGBear.

Can happen a lot when GOG servers are overwhelmed.

So, what's to stop a pirate from opening a new GOG account with each purchase refund? How would GOG "keep tabs" on that?

Rather, GOG would think each new case is a new person requesting a refund for the first time ever.

Yes, they do, if they want an up-to-date game version with all the patches.

In contrast, pirated versions of games, generally speaking, only ever feature the very first, 1.0, unpatched, worst possible version of the game.

Thus, contrary to many of the posts in this thread, pirates do indeed have a heavy incentive to exploit GOG's refund loophole, as purchasing the games and then refunding & keeping them does indeed give them something that pirating them via the traditional ways cannot.

It's possible to keep track of multiple accounts even if they're made from different IP addresses. Of course someone from the staff has to suspect that the specified account is made by the same person. A new account with a single purchase with a request for a refund is quite suspicious in the first place however, so I presume it would be double checked instantly.

Apparently you have no clue what you are talking about. Why then?