Aiming FY2018 Q3 Earnings Results

Key insights

6 takeaways

01
Aiming significantly narrowed its operating loss to 5 million yen in Q3 2018, a substantial improvement from the 436 million yen loss reported in the previous quarter.See it on page 10
02
Quarterly revenue fell 5.0% to 1,728 million yen, driven by the absence of one-time title rights transfer income and stagnant monetization in the core title, Logres.See it on page 4
03
Operational efficiency gains were achieved through reduced advertising spend, lower partner-borne expenses, and optimizing platform fees by shifting Caravan Stories toward PC-based distribution.See it on page 20
04
International expansion provided a key revenue offset, as the Taiwanese market launch of Caravan Stories contributed meaningfully to results despite softening domestic performance.See it on page 14
05
Management projects a return to profitability in Q4 2018, supported by upcoming anniversary events and the release of new titles including Gestalt Odin and Sengoku Taiga.See it on page 22
06
The company is prioritizing long-term lifecycle management for its MMO portfolio while focusing on internal R&D to refine user acquisition costs.See it on page 27

Summary

The fiscal year 2018 third-quarter earnings report for Aiming, an online game developer specializing in mobile MMO titles, details a period of financial transition characterized by revenue contraction and improved operational efficiency. For the three-month period ending September 2018, the company reported revenue of 1,728 million yen, a 5.0% decrease from the previous quarter. This decline was primarily attributed to the absence of one-time title rights transfer income recorded in the prior period, alongside stagnant monetization in the core title, Logres.

Despite the revenue decline, the company significantly narrowed its operating loss to 5 million yen, compared to 436 million yen in the second quarter. This improvement was driven by a substantial reduction in cost of sales and selling, general, and administrative expenses. Key cost-saving measures included the reduction of partner-borne expenses in joint projects, lower advertising expenditures for domestic titles, and the optimization of platform fees through a shift toward PC-based distribution for Caravan Stories.

The company’s strategy remains focused on the long-term lifecycle management of MMO titles. While domestic revenue for Caravan Stories softened, the expansion into the Taiwanese market provided a meaningful contribution, reflecting the growth potential of the broader East Asian region. Looking ahead, the company is prioritizing the release of new titles, such as Gestalt Odin and Sengoku Taiga, while continuing to leverage its internal research and development capabilities to refine user acquisition costs. Management projects a return to profitability in the fourth quarter, supported by planned anniversary events for existing titles and the launch of new content, though they maintain a cautious outlook due to the inherent volatility of the mobile gaming market.