NEXON Q4 2023 Investor Presentation

Key insights

6 takeaways

01
Nexon reported a net loss of ¥41.9 billion in Q4 2023, driven by a ¥44.4 billion impairment charge from an AGBO investment and operational issues in the Chinese version of Dungeon&Fighter and the Korean version of MapleStory.See it on page 7
02
Despite the Q4 loss, the company achieved record-breaking financial performance for the full 2023 fiscal year, supported by core franchises MapleStory and FC ONLINE alongside the launch of THE FINALS.See it on page 7
03
The company anticipates a year-over-year revenue decline in Q1 2024 due to a cooling period for major franchises, rising cloud and HR costs, and the absence of prior-year foreign exchange gains.See it on page 15
04
Nexon maintains a strong liquidity position with ¥280.5 billion in cash and cash equivalents, and projects Q1 2024 to be the second-highest first-quarter revenue performance in its history.See it on page 15
05
Strategic priorities for 2024 include stabilizing established virtual worlds through more player-friendly business models and accelerated content updates to address recent engagement challenges.See it on page 3
06
Long-term growth plans center on expanding platform reach and developing new intellectual property while leveraging proprietary technology to maintain the resilience of core franchises.See it on page 44

Summary

Nexon achieved record-breaking financial performance for the 2023 fiscal year, underpinned by the sustained success of core franchises such as MapleStory and FC ONLINE, complemented by the successful market entry of THE FINALS. Despite this annual growth, the fourth quarter faced significant headwinds, including in-game economic imbalances within the Chinese version of Dungeon&Fighter and regulatory and community challenges affecting MapleStory in Korea. These operational difficulties, compounded by a substantial ¥44.4 billion impairment charge related to an AGBO investment, resulted in a quarterly net loss of ¥41.9 billion.

Looking toward the first quarter of 2024, the company anticipates a year-over-year revenue decline as major franchises experience a cooling period and operating costs rise due to increased human resources and cloud infrastructure investments. Furthermore, the absence of one-time foreign exchange gains recorded in the previous year will exert additional pressure on bottom-line results. Nevertheless, the company maintains a robust financial position, supported by a cash and cash equivalents balance of ¥280.5 billion, and expects the upcoming quarter to remain the second-highest first-quarter revenue performance in its history.

The long-term strategic outlook focuses on stabilizing and revitalizing established virtual worlds while expanding platform reach and developing new intellectual property. By transitioning toward more player-friendly business models and accelerating content updates, the company aims to restore engagement and ensure revenue stability. This strategy relies on leveraging proprietary technology to foster deeply immersive online experiences, ensuring that the core franchise foundation remains resilient against short-term volatility and evolving market demands across global gaming segments.