Quarterly Securities Report: The Second Quarter of the 22nd Fiscal Year

Key insights

6 takeaways

01
Nexon reported total revenue of ¥218,523 million for the first half of the 22nd fiscal year, marking a 24.8% year-over-year increase with net income reaching ¥77,329 million.See it on page 7
02
Financial growth was primarily driven by the performance of key titles including EA SPORTS FIFA ONLINE 4, EA SPORTS FIFA MOBILE, Blue Archive, Wars of Prasia, and HIT2, with the Korean market serving as the primary revenue source.See it on page 6
03
The company maintains a strong financial position with total assets of ¥1,151,860 million and an equity ratio of 83.3%.See it on page 8
04
Nexon is actively managing capital through a share buyback program of up to ¥20,000 million and an interim dividend payment of ¥5.0 per share.See it on page 49
05
Strategic investment activity has increased, highlighted by the acquisition of Brothers International, LLC and allocations into equity-method affiliates and real estate trusts.See it on page 49
06
The Public Investment Fund maintains a significant ownership stake in the company, currently holding approximately 10.23% of shares.See it on page 15

Summary

Nexon demonstrates robust financial health and sustained growth for the first half of the 22nd fiscal year, ending June 30, 2023. Total revenue reached ¥218,523 million, representing a 24.8% increase over the same period in the previous year, while net income rose to ¥77,329 million. This performance is largely attributed to the sustained popularity of key titles such as EA SPORTS FIFA ONLINE 4, EA SPORTS FIFA MOBILE, Blue Archive, Wars of Prasia, and HIT2. The Korean market remains the primary driver of this expansion, supported by consistent contributions from both PC online and mobile gaming segments.

The company maintains a strong balance sheet with total assets of ¥1,151,860 million and an equity ratio of 83.3%. While operating cash flow remains healthy at ¥57,662 million, the company has shifted capital toward increased investing activities, including the acquisition of Brothers International, LLC, and strategic reclassifications of financial assets. These investments, alongside a share buyback program of up to ¥20,000 million and an interim dividend of ¥5.0 per share, reflect an active approach to capital management and a commitment to enhancing shareholder value. The Public Investment Fund continues to hold a significant stake of approximately 10.23%.

Operational stability is further evidenced by the consistent application of core business and research strategies, even as the company adopts new accounting standards regarding income taxes and the OECD’s Pillar Two model rules. Despite minor impairment losses on intangible assets and a net decrease in cash equivalents due to reallocations into time deposits and financial instruments, the company’s financial position remains secure. By balancing aggressive investment in equity-method affiliates and real estate trusts with disciplined capital returns, the organization continues to solidify its market position within the global gaming industry.