Nexon Earnings Results: First Quarter 2024

Key insights

6 takeaways

01
Nexon reported Q1 2024 revenue of ¥108.4 billion, a 13% year-over-year decline, with operating income falling 48% to ¥29.1 billion and net income dropping 32% to ¥35.9 billion.See it on page 1
02
The North American and European markets grew by 92% to ¥9.9 billion, driven by the performance of THE FINALS and DAVE THE DIVER, offsetting double-digit revenue declines in Korea and China.See it on page 2
03
The company is prioritizing long-term franchise health over short-term monetization, evidenced by a 14-point improvement in the MapleStory Net Promoter Score in Korea.See it on page 2
04
Nexon is banking on the May 2024 launch of Dungeon&Fighter Mobile in China and the development of The First Descendant and MABINOGI MOBILE to revitalize its core intellectual property.See it on page 1
05
Despite the revenue downturn, the company maintained profitability through disciplined cost management in HR, marketing, and cloud services, supplemented by foreign exchange gains.See it on page 1
06
The board of directors authorized a ¥30 billion share repurchase program and increased the semi-annual dividend to signal confidence in long-term growth.See it on page 3

Summary

Nexon’s first-quarter 2024 financial results reflect a period of transition characterized by year-over-year revenue declines, yet performance consistently exceeded internal expectations. The company reported quarterly revenue of ¥108.4 billion, representing a 13% decrease compared to the same period in 2023. Operating income fell 48% to ¥29.1 billion, while net income reached ¥35.9 billion, a 32% decline. These results were primarily driven by challenging year-over-year comparisons against strong 2023 performances from key franchises like Dungeon&Fighter and FC ONLINE. Despite these headwinds, the company maintained profitability through disciplined cost management regarding human resources, marketing, and cloud services, alongside favorable foreign exchange gains.

Geographically, the company experienced varied results across its primary markets. While revenue in Korea and China saw double-digit percentage declines, the North American and European segments grew by 92% to ¥9.9 billion, bolstered by titles such as THE FINALS and DAVE THE DIVER. In Korea, the company prioritized long-term player engagement over aggressive monetization for the MapleStory franchise, resulting in a notable 14-point improvement in the game's Net Promoter Score.

Looking forward, the company is focused on a franchise management strategy designed to revitalize core intellectual property and expand its global footprint. Key upcoming initiatives include the May 2024 launch of Dungeon&Fighter Mobile in China and the continued development of titles such as The First Descendant and MABINOGI MOBILE. To demonstrate confidence in its long-term growth, the board of directors authorized an increased semi-annual dividend and a ¥30 billion share repurchase program. The company remains committed to balancing top-line growth with operational efficiency to navigate the evolving global gaming landscape.