FinancialGREE Inc.
Financial Results Briefing for FY2019 First Quarter Transcript
1 Mar 20194 pages~10 min full read
GREE reported Q1 FY2019 net sales of 18.2 billion yen and an operating income of 1.6 billion yen, exceeding internal forecasts despite a quarter-on-quarter sales decline caused by the absence of previous major title anniversaries.
Net income grew significantly compared to the previous period, driven by the sale of investment securities and the lack of recurring impairment losses.
The company is shifting its gaming strategy toward self-distribution in North America, South Korea, and Taiwan for titles like DanMachi to improve profit margins compared to partner-led models.
GREE is diversifying its gaming portfolio by expanding into the Nintendo Switch market and developing four new titles, alongside its existing push into messenger-based gaming via the LINE Quick Game platform.
The live entertainment segment is centered on the full launch of the VTuber platform REALITY, supported by the VTuber Fund and strategic partnerships with King Records and Idea Factory.
Management issued a conservative Q2 operating income forecast of 1 to 1.5 billion yen to account for the volatility of overseas self-distribution and fluctuating user transactions in titles like Another Eden.
This financial briefing outlines the performance and strategic direction of GREE, Inc. for the first quarter of fiscal year 2019. The company reported net sales of 18.2 billion yen and an operating income of 1.6 billion yen, which exceeded internal forecasts despite a slight quarter-on-quarter decline in sales. This decline was attributed to a high baseline in the previous quarter driven by major title anniversaries. Net income saw substantial growth due to the sale of investment securities and the absence of previous impairment losses.
The strategic focus centers on three pillars: game business expansion, live entertainment, and advertising media. In the gaming sector, the company is prioritizing global distribution and multi-platform reach. Key activities include the North American, South Korean, and Taiwanese launches of DanMachi via self-distribution, which aims to improve profit margins compared to partner-led models. The company also released Wild Arms: Million Memories and expanded into messenger-based gaming via the LINE Quick Game platform. Future growth is supported by a pipeline of four titles in development and a push into the Nintendo Switch market.
The live entertainment segment highlights the full launch of REALITY, a dedicated live-streaming platform for VTubers. This ecosystem is being bolstered by the VTuber Fund and strategic partnerships with King Records and Idea Factory to develop music projects and live events. In the advertising and media segment, the company is focusing on strengthening the community potential of its LIMIA and MINE platforms. Looking ahead to the second quarter, the company issued a range-based forecast of 1 to 1.5 billion yen in operating income to account for the inherent volatility of new overseas self-distribution efforts and fluctuating user transactions in existing titles like Another Eden.
