Nexon Consolidated Financial Results for the Fiscal Year Ended December 31, 2015

Key insights

6 takeaways

01
Nexon reported a 10.0% increase in consolidated revenue to ¥190,263 million and an 88.1% surge in net income to ¥55,132 million for the fiscal year ended December 31, 2015.See it on page 6
02
Growth was primarily driven by the PC title Dungeon&Fighter in China and the successful launch of mobile games HIT and DomiNations in Korea.See it on page 6
03
The company maintains a strong financial position with ¥194,225 million in cash and cash equivalents and ¥60,152 million in operating cash flows.See it on page 16
04
Regional performance was uneven, as strong growth in Korea and China was offset by losses in Japan and North America, the latter due to heavy marketing spend for mobile expansion.See it on page 6
05
Management plans to implement capital restructuring in 2016 to improve capital efficiency and operational flexibility.See it on page 27
06
Strategic priorities for future sustainability include the development of original intellectual property and the strengthening of global information security protocols.See it on page 15

Summary

Nexon achieved robust financial growth during the fiscal year ended December 31, 2015, characterized by a 10.0% increase in consolidated revenue to ¥190,263 million and a substantial 88.1% surge in net income attributable to owners of the parent, reaching ¥55,132 million. This performance underscores the efficacy of the company’s item-based, free-to-play revenue model, which successfully lowers entry barriers to cultivate a vast, engaged user base. The primary drivers of this expansion were the enduring popularity of the PC title Dungeon&Fighter in China and the successful introduction of mobile games such as HIT and DomiNations within the Korean market.

While the company’s overall financial position remains strong, with cash and cash equivalents totaling ¥194,225 million supported by ¥60,152 million in operating cash flows, performance varied by geographic segment. Operations in Korea and China served as the primary engines for growth, whereas the Japan and North America segments experienced losses, the latter largely attributed to aggressive marketing investments intended to capture market share for new mobile offerings. Despite these regional challenges, the company maintains a positive outlook for early 2016, anticipating continued momentum in the mobile sector and stability from its core PC portfolio.

Looking toward future sustainability, management is prioritizing the development of high-quality original intellectual property and the enhancement of global information security protocols. To further optimize corporate structure, the company has initiated plans for capital restructuring in 2016, aimed at improving capital efficiency and operational flexibility. Although market volatility precludes the issuance of full-year guidance, the strategic focus remains on leveraging established PC franchises while scaling mobile operations to ensure long-term profitability across its global footprint.