FY2020 Third Quarter Results Briefing

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.