FinancialGREE
FY2013 First Quarter Financial Results
14 Nov 201228 pages~13 min full read
GREE reported Q1 FY2013 net sales of 37.9 billion yen, a 25% year-over-year increase despite a 5% sequential decline.
Operating profit fell 17% sequentially to 15.7 billion yen, driven by higher labor costs and international expansion investments.
The company is pivoting toward smartphone native applications and leveraging major IP through partnerships with Konami, Square Enix, and NCSoft for titles like Metal Gear Solid and Final Fantasy.
International growth strategy includes the acquisition of Funzio and the opening of a dedicated development studio in Vancouver.
Domestic market expansion is supported by strategic collaborations with Yahoo! JAPAN and the acquisition of Pokelabo.
Diversification efforts include new ventures in merchandising and mobile advertising partnerships, notably with MobPartner.
The company is prioritizing platform safety and industry self-regulation through the Japan Social Game Association (JASGA) and 24-hour monitoring systems.
GREE’s financial results for the first quarter of fiscal year 2013 reveal a period of strategic transition and global expansion. While net sales of 37.9 billion yen represented a 5% decline from the previous quarter, they marked a 25% increase year-over-year. Operating profit reached 15.7 billion yen, down 17% sequentially due to increased labor costs and upfront investments associated with international growth. Despite the quarterly dip, monthly sales hit a trough in July 2012 and entered a recovery trend by August, driven by a strengthening lineup of social games and improved operational capabilities.
The strategic focus centers on shifting toward smartphone native applications and leveraging high-profile intellectual property (IP). Domestic growth is supported by partnerships with Yahoo! JAPAN and Pokelabo, while international efforts include the acquisition of Funzio and the establishment of a development studio in Vancouver. The portfolio is expanding through collaborations with major publishers like Konami, Square Enix, and NCSoft to launch titles based on franchises such as Metal Gear Solid and Final Fantasy. These initiatives aim to secure a dominant position in the global smartphone social game market.
Beyond game development, the business structure is becoming more multilayered through new ventures in merchandising and mobile advertising partnerships, such as the agreement with MobPartner. The industry environment is also evolving with the establishment of the Japan Social Game Association (JASGA), which focuses on self-regulation, youth education, and improved customer support. To maintain platform safety, a 24-hour monitoring system and strict age verification protocols remain in place. These combined efforts in IP acquisition, global infrastructure, and platform safety are designed to accelerate growth heading into the holiday season and beyond.
