Financial Results for the 2nd Quarter of Fiscal Year Ending December 31, 2026

GungHo Online Entertainment’s financial results for the second quarter of the fiscal year ending December 31, 2026, demonstrate consistent growth in profitability despite a challenging global economic environment characterized by inflation and currency fluctuations. The company reported net sales of 51,759 million yen for the six-month period ending June 30, 2026, representing a 2.3% increase compared to the same period in the previous year. Operating profit saw a more significant rise of 27.1% to 6,380 million yen, while ordinary profit grew by 47.2% to 7,878 million yen. Interim net profit attributable to owners of the parent reached 3,460 million yen, a 40.4% year-on-year increase.

The company’s performance was driven by the sustained engagement of its flagship title, Puzzle & Dragons, which surpassed 64 million cumulative domestic downloads, alongside the successful performance of Ragnarok-related titles managed by its subsidiary, Gravity Co., Ltd. Strategic efforts remain focused on global expansion and the development of new content, with nine titles currently in the pipeline, including the upcoming release of Ninjala 2: The Uncharted Planet. These development activities involve significant upfront investment, particularly in outsourcing expenses.

As of June 30, 2026, the company maintained a solid financial position with total assets of 165,141 million yen and a shareholder's equity ratio of 69.3%. Total net assets decreased to 145,689 million yen, primarily due to dividend payments and the acquisition and subsequent cancellation of treasury shares. Given the inherent volatility of the content business, the company continues its policy of providing quarterly financial disclosures while refraining from issuing full-year consolidated earnings forecasts. All financial reporting adheres to Japanese GAAP, and the company operates as a single-segment entity.