NEXON Co., Ltd. Annual Securities Report: The 21st Fiscal Year

Key insights

6 takeaways

01
NEXON achieved record consolidated revenue of 353,714 million yen in fiscal year 2022, marking a 28.9% year-over-year increase driven by core titles like MapleStory and Dungeon&Fighter.See it on page 38
02
Net income attributable to owners of the parent fell by 12.7% to 100,339 million yen, impacted by higher operating costs, impairment losses, and the expiration of tax incentives for subsidiary NEOPLE INC.See it on page 107
03
The company maintains a strong liquidity position with 409,368 million yen in cash and cash equivalents to support live operations and strategic acquisitions like Embark Studios AB.See it on page 184
04
Executive compensation is tied to performance-linked equity metrics, specifically utilizing relative Total Shareholder Return and regional EBITDA targets to align leadership with long-term growth.See it on page 94
05
Operational risks include market competition, technological shifts, and evolving global data privacy regulations, which the company mitigates through ISMS-certified information security protocols.See it on page 26
06
The business model relies on a global network of 41 consolidated subsidiaries focused on microtransactions across PC and mobile platforms.See it on page 197

Summary

NEXON Co., Ltd.’s annual report for the 21st fiscal year, ending December 31, 2022, details a period of significant financial growth and strategic organizational evolution. The company, a global leader in virtual world gaming, achieved record-breaking consolidated revenue of 353,714 million yen, representing a 28.9% year-over-year increase. This performance was primarily driven by the strength of core intellectual properties such as MapleStory and Dungeon&Fighter, alongside robust activity within the Korean PC and mobile gaming segments. Despite this revenue expansion, net income attributable to owners of the parent declined by 12.7% to 100,339 million yen, a result of rising operating costs, increased impairment losses, and a higher effective tax rate following the expiration of specific tax incentives for its primary subsidiary, NEOPLE INC.

The company maintains a global operational footprint with 41 consolidated subsidiaries, focusing on a microtransaction-based revenue model across PC and mobile platforms. To sustain long-term value, the organization prioritizes multi-platform expansion, the development of new intellectual properties, and the integration of strategic acquisitions like Embark Studios AB. Governance is managed through a robust framework featuring an Audit and Supervisory Committee and a Compensation Committee, with a strong emphasis on independent oversight and performance-linked equity compensation for directors. This compensation structure utilizes objective metrics, including relative Total Shareholder Return and regional EBITDA targets, to align executive incentives with sustainable growth.

Operating in a complex international environment, the company faces inherent risks related to market competition, rapid technological shifts, and evolving global regulations concerning data privacy and content assessment. To mitigate these threats, the group employs rigorous information security protocols, including ISMS certification, and maintains a strong liquidity position with cash and cash equivalents totaling 409,368 million yen. While the company continues to navigate financial volatility—including foreign exchange fluctuations and impairment risks—it remains committed to its strategy of reinvesting cash flows into live operations and maintaining a transparent, shareholder-focused capital allocation policy.