NEXON Q3 2015 Investor Presentation

Key insights

6 takeaways

01
Nexon reported Q3 2015 revenue of ¥49.8 billion, a 9% year-over-year increase driven by the performance of Dungeon&Fighter in China and the mobile title DomiNations.See it on page 6
02
Operating income rose 22% to ¥18.4 billion during the quarter, supported by strong sales and disciplined human resource spending.See it on page 16
03
Net income for Q3 2015 reached ¥19.2 billion, confirming the success of the company’s content-led growth strategy.See it on page 6
04
The company projects Q4 2015 revenue to remain flat or slightly decline as it prioritizes investment in its long-term development pipeline.See it on page 14
05
Strategic growth continues to rely on consistent content updates for established franchises like MapleStory alongside the diversification of mobile and PC partnerships.See it on page 18
06
Operational risks include the need for rapid technological adaptation, complexities in third-party licensing, intellectual property protection, and shifting global regulatory environments.See it on page 30

Summary

Nexon achieved strong financial growth during the third quarter of 2015, reporting revenues of ¥49.8 billion, which represents a 9% increase compared to the same period in the previous year. This performance was primarily fueled by the sustained popularity of core PC titles, most notably Dungeon&Fighter in the Chinese market, alongside significant contributions from an expanding mobile gaming portfolio, including the title DomiNations. Operational efficiency also improved during this period, as evidenced by a 22% rise in operating income to ¥18.4 billion, a result supported by robust sales figures and disciplined human resource expenditure.

The company’s strategic focus remains centered on maintaining a consistent cadence of high-quality content updates for established franchises like MapleStory while simultaneously diversifying its revenue streams through new mobile and PC partnerships. Despite the positive momentum, the outlook for the fourth quarter suggests a period of stabilization, with revenue projections expected to remain flat or experience a slight decline as the company invests in its long-term development pipeline.

Future performance remains subject to a variety of inherent industry risks, including the necessity for rapid technological adaptation, the complexities of third-party licensing agreements, and the ongoing challenges of intellectual property protection. Furthermore, the company must navigate shifting global regulatory environments that could impact its operational capacity. While these factors present potential volatility, the current financial foundation remains stable, with net income reaching ¥19.2 billion for the quarter, reflecting a successful execution of the company’s current content-led growth strategy across its primary geographic markets.