FinancialGREE Inc.
FY2020 Third Quarter Results Briefing
1 Sept 20204 pages~6 min full read
GREE Inc. reported Q3 FY2020 net sales of ¥15.4 billion and an operating income of ¥1.2 billion, achieving an 8.0% operating income ratio through cost discipline.
Profitability improved due to reduced advertising and depreciation expenses, alongside the strategic closure of underperforming gaming titles.
The global expansion of Another Eden drove a 1.4x quarter-on-quarter increase in overseas sales following its launch in 29 additional territories.
The company is preparing for future growth with a pipeline of four to six titles for FY2021 and beyond, including the global launch of SINoALICE and the media-mix project Assault Lily: Last Bullet.
Management expects a weaker Q4 due to COVID-19-related advertising headwinds and anticipated one-time losses from ongoing structural reforms and portfolio reviews.
GREE is maintaining shareholder returns through a ¥2.5 billion stock repurchase program and a stable dividend forecast of ¥10 per share.
The company’s geographic footprint has expanded to over 130 countries and territories, while the REALITY platform continues to scale within the live entertainment segment.
GREE Inc. reported its third-quarter financial results for fiscal year 2020, highlighting a period of strategic transition characterized by improved profitability despite a decline in net sales. Net sales reached ¥15.4 billion, while operating income rose to ¥1.2 billion, representing an operating income ratio of 8.0%. This profit growth was driven by the strong performance of first-party intellectual properties and disciplined cost management, including significant reductions in advertising and depreciation expenses.
The gaming segment saw mixed results as the company optimized its portfolio by closing underperforming titles, which led to softer overall coin consumption. However, the global expansion of Another Eden proved successful, with overseas sales increasing 1.4 times quarter-on-quarter following its launch in 29 additional territories. Looking ahead, the pipeline includes four to six titles in development for fiscal year 2021 and beyond, including the global launch of SINoALICE and the upcoming media-mix project Assault Lily: Last Bullet. Beyond gaming, the live entertainment business continues to scale through the REALITY platform, while the advertising and media segment faces headwinds due to the COVID-19 pandemic.
Management anticipates a weaker fourth quarter as the pandemic impacts advertising demand and the company undergoes structural reforms. These measures include reviewing the business portfolio and reducing fixed costs to ensure long-term stability, which may result in one-time losses. Despite these challenges, the company remains committed to shareholder returns, progressing through a ¥2.5 billion stock repurchase program and maintaining a stable dividend forecast of ¥10 per share. The geographic scope of operations continues to broaden, with key titles now reaching over 130 countries and territories.
