Nexon Q2 2022 Investor Presentation

Key insights

6 takeaways

01
Nexon reported record Q2 2022 revenue of ¥84.1 billion, a 50% year-over-year increase driven by core franchises including MapleStory, FIFA ONLINE 4, and Dungeon&Fighter Mobile.See it on page 10
02
Net income surged 176% year-over-year, significantly aided by a ¥27.7 billion foreign exchange gain, while operating income grew by 47%.See it on page 25
03
The company initiated a three-year share repurchase program valued at up to ¥100 billion to demonstrate financial stability and commitment to shareholder value.See it on page 18
04
Nexon’s long-term strategy prioritizes the cultivation of enduring virtual worlds over short-cycle gaming models to ensure consistent, multi-billion-yen earnings.See it on page 48
05
While the company expects continued revenue growth in Korea, North America, and Europe, it projects a decline in the Chinese market due to difficult year-over-year comparisons.See it on page 15
06
Future growth is supported by a robust pipeline of new mobile titles, such as HIT2, and a focus on maintaining strong monthly active users and average revenue per paying user across its global portfolio.See it on page 3

Summary

Nexon achieved record financial performance in the second quarter of 2022, reporting revenue of ¥84.1 billion, which represents a 50 percent year-over-year increase. This growth was primarily fueled by the sustained success of core franchises, including MapleStory, FIFA ONLINE 4, and the mobile iteration of Dungeon&Fighter. Operating income rose by 47 percent, while net income surged by 176 percent, a result significantly bolstered by a ¥27.7 billion foreign exchange gain. These results underscore the efficacy of the company’s long-term strategy, which prioritizes the cultivation of enduring virtual worlds over traditional, short-cycle gaming models.

Geographically, the company maintains a diverse footprint with expectations for continued revenue growth across Korea, North America, and Europe. While the Chinese market faces a projected decline due to difficult year-over-year comparisons, the overall outlook remains positive, supported by a robust pipeline of new mobile titles such as HIT2 and ongoing live operations. To further demonstrate confidence in its financial stability and commitment to shareholder value, the company has initiated a three-year share repurchase program valued at up to 100 billion yen.

The company’s long-term thesis centers on the resilience of virtual worlds, which are characterized by their ability to generate consistent, multi-billion-yen earnings over extended periods. By leveraging a strong balance sheet and significant cash reserves, the organization continues to focus on platform expansion and the development of new intellectual property. This strategic approach aims to mitigate short-term market volatility while ensuring that key performance indicators, such as monthly active users and average revenue per paying user, remain strong across its global portfolio.