NEXON Q2 2021 Earnings Prepared Remarks

Nexon’s second quarter 2021 earnings report characterizes the period as a strategic operational inflection point, prioritizing long-term player trust and product quality over short-term monetization. The company reported quarterly revenue of 56.0 billion yen, falling within its projected outlook despite a 13% year-over-year decline. Financial performance was mixed, with strong results from titles like The Kingdom of the Winds: Yeon and Sudden Attack offset by lower-than-expected performance in MapleStory in Korea and Dungeon&Fighter in China.

Management is actively addressing specific challenges within these core franchises. In Korea, the company is rebuilding player trust in MapleStory through enhanced transparency regarding in-game purchase probabilities. In China, leadership has appointed new creative oversight for the Dungeon&Fighter franchise to revitalize content and re-engage the player base. These efforts are viewed as essential investments to ensure the long-term sustainability and growth of these key assets, rather than pursuing immediate revenue gains.

Looking ahead, the company maintains a robust development pipeline, including Mobile Dungeon&Fighter, KartRider: Drift, and new projects from Embark Studios. Management emphasizes an iterative, quality-focused development philosophy, explicitly rejecting industry-standard "crunch" practices to ensure that new titles meet high artistic and engagement standards. While the third quarter is expected to face challenging year-over-year comparisons due to record-breaking performance in 2020, the company remains committed to its long-term strategy of expanding its intellectual property reach through new media divisions and disciplined capital allocation. The company continues to monitor its financial health, noting a 4.5 billion yen revaluation loss on bitcoin holdings while maintaining a stable dividend policy and a long-term share repurchase program.