FinancialGREE
FY2023 Third Quarter Financial Results
11 May 202328 pages~15 min full read
GREE reported Q3 FY2023 net sales of ¥22.2 billion and operating income of ¥4.2 billion, driven by the flagship title Heaven Burns Red and strategic divestments.
Operating income faced downward pressure from a ¥3.1 billion increase in costs, primarily due to aggressive promotional spending aimed at securing long-term market share.
The REALITY metaverse platform reached over 42 million annual visitors and expanded its B2B presence through the REALITY XR cloud and the FIRST STAGE PRODUCTION VTuber agency.
The company maintains a strong financial position with ¥30.8 billion in net cash, a total asset base of ¥120 billion, and a dividend forecast of ¥11 per share.
The Investment and Incubation segment manages approximately ¥75 billion in assets and continues to deliver an internal rate of return ranging from 16% to 23%.
GREE maintained a stable workforce of 1,593 employees while prioritizing long-term growth in virtual world infrastructure and digital transformation.
GREE reported net sales of ¥22.2 billion and operating income of ¥4.2 billion for the third quarter of fiscal year 2023, reflecting a strategic balance between core gaming profitability and aggressive expansion into emerging digital sectors. Financial performance was primarily bolstered by the continued success of the flagship title Heaven Burns Red and the strategic exit of positions within the Investment and Incubation business. While the Internet and Entertainment segment experienced growth, operating income faced downward pressure from a ¥3.1 billion increase in costs, largely attributed to substantial upfront promotional investments intended to secure long-term market share.
The company’s growth strategy centers on the diversification of its Metaverse and DX business units. The REALITY platform has achieved significant scale, recording over 42 million annual visitors and expanding its B2B footprint through the REALITY XR cloud and the launch of the FIRST STAGE PRODUCTION VTuber agency. These initiatives are supported by a robust financial foundation, including ¥30.8 billion in net cash and a total asset base of ¥120 billion. Despite a slight quarterly decrease in investment securities due to distributions, the investment portfolio remains a critical pillar of value, maintaining approximately ¥75 billion in assets under management.
Long-term stability is further evidenced by the Investment and Incubation segment’s internal rate of return, which ranges from 16% to 23% across various phases. Although advertising expenditures rose significantly during the quarter to support global launches, the company maintained a stable headcount of 1,593 employees and reaffirmed its dividend forecast of ¥11 per share. This financial posture indicates a commitment to prioritizing medium-to-long-term growth in virtual world infrastructure and digital transformation while leveraging the steady cash flow generated by its established gaming and investment operations.
