FY2019 Second Quarter Financial Results

GREE reported second-quarter net sales of ¥17.7 billion and operating income of ¥1.0 billion for the fiscal year ending June 2019. While these figures represent a year-over-year decline in profitability, they align with internal forecasts and reflect a deliberate period of reinvestment. The company is currently prioritizing long-term growth through increased fixed costs associated with full-scale development for new titles and the expansion of overseas distribution for core intellectual properties such as DanMachi and Another Eden. This strategic shift includes a transition toward self-distribution in international markets and the diversification of the portfolio across multiple platforms, exemplified by the release of Fishing Star on the Nintendo Switch.

The financial landscape is characterized by a robust net cash position of ¥86.9 billion, providing the necessary liquidity to fund the development of the REALITY Avatar livestreaming platform and the growth of the award-winning media app aumo. Despite a projected dip in third-quarter operating income to between ¥0.3 and ¥0.8 billion, the organization is streamlining operations by withdrawing from unprofitable titles and optimizing its workforce. As of December 2018, the group employed 1,701 personnel, with the vast majority concentrated in the Game and Entertainment segment to support its multiplatform and global expansion initiatives.

Ultimately, the current fiscal performance underscores a transition from domestic mobile dominance toward a global, multi-faceted entertainment model. By leveraging first-party IPs and expanding into the VTuber and advertising media sectors, the strategy aims to stabilize future earnings through a broader geographic and platform reach. Although development investments and overseas marketing costs currently weigh on margins, the focus remains on strengthening media potential and establishing a sustainable international presence across Asia and other global markets.