PUBG Never Died. Krafton Just Forgot Why It Worked

All right, Phil, let's talk about Craftton.
Yeah. So, I wanted to talk about Craftton cuz we haven't had like a serious conversation about the company and particularly about PUBG. And that seems like a tragedy considering PUBG is the number one game on Steam of all time when it comes to Mac CCU when it launched a while ago. And this was before it went free to play. And we've talked about craft and it's mostly just [ __ ] on them for the Subnotica up or talking about Enzo's magnificent sales. And so do ourselves a service to talk about them more seriously. And the reason they're interesting is they have the problem that a lot of these companies where they come out with a huge success and they can't figure out how to grow outside of it or how to expand. And so Craftton has basically been throwing money everywhere. They've been doing a ton a ton of investments. They spent500 million $500 million this year on a Japanese

anime and PR agency called ADK.
They also bought an American studio as well. They've been doing a ton of investments in AI. But honestly, it just looks like a company that doesn't really know what to do next. And I think they finally have started to figure out what that next chapter is. And that next chapter is exactly what all the companies that have these huge successes should be doing, which is doubling down on your core franchises. Like this is straight from the Eric Crest playbook. So, you know, PUBG, if you remember, is not just successful on PC console. In fact, the PUBG mobile version that Tencent makes is actually responsible for the lion share of the company's money. At one point, it was 75% of the company's revenue they disclosed in 2024. And so remember they tried to launch their own version called uh was it new state or new light excuse me off the top of my head new state and that was a absolute cluster of epic proportions that thing is largely dead but they are finally doubling down on the HD franchises. So they have PUBG

blind spot
which will be coming out next month which is a 5v5 tactical shooter. Let's see if they can go after Valerant and CS GO. I think that's a sound thesis at least at a high level. They also remember took a shot at Enzo.
You know, we'll see if that franchise ever goes anywhere. And the other PUBG game they have coming is called Blackbudget, which is going to be late 2027, and we're starting to get some more information about what that's actually going to entail. I have a friend who got into an early access. So, we'll be covering that on shooter monthly. And the other things [clears throat] that they're doing are particularly interesting on mobile, which is again where they should be focusing, I would argue, is Dark and Darker mobile, which is called Abyss of Dungeons. that got renamed. Although that thing's been in soft launch hell and when you look at the downloads, it doesn't look like it's moving. So, you know, rest in peace. And I actually think there's potential in Power World Mobile, which they signed. I really think Pow World has some opportunity to grow. It won't be a card game,
which they announced for the franchise, which is bizarre from the original developer in Japan, but I do think Power

World Mobile, like a true adaptation, can work. And so, kind of where where does this leave us? Well, I'm a little bit cranky like Eric. Like, I honestly think they should have returned money to shareholders. Like if you can't if you can't reinvest capital into your own company to grow and you're just throwing money at M&A or these really silly investments like Japanese anime firms, like you you should be returning your money to shareholders in the form of dividends. And so we'll see if the strategy goes anywhere, but I do think they're finally on the right track after some fuckups and some misadventures and the uh the tropics. So let's let's see if PUBG Blackbudget and PUBG blind spot can scale. Actually, I'm just going to kind of agree with what you just said [laughter] because like yes, doubling down on the PUBG franchise with with different iterations sounds like it could make sense. You know, they have such a cash cow with this thing. Reinvesting that rather than going after things like Enzoy. Yeah, the Abyss of Judges looks terrible. I do like the Power World Mobile. I think that makes total sense for them to pick that up. By the way, my one of my best

short calls of the last like three or four years was Craftton when they came out with New State. They're in a tough spot. They have so much success with PUBG is that there's just nowhere else for them to go. So hopefully these new iterations on on the core franchise will work
and it's growing. PUBG is growing. PUBG has done is growing on PC. It's done fairly well. Right now we're looking at max daily concurrent players on Steam. And really since 2024 it's been
growing. Remember, they also made a free-to-play change. And if you look at the mobile version, which again is operated by 10 cent, it's been a little bit on a decline, and we're still looking at a franchise that's doing around 20 million DAU on mobile alone. So, like, you combine all of these franchise DAU together. I mean, I'm sure this thing, you know, maybe does 40 million DAU across all the platforms. I mean, that's extremely impressive.
No, I think Phil, I agree with you as well. This is came from an article from pockamer.biz. And so this was like the biggest no duh part of this. The model supports early validation through early

access and limited market launches allowing projects to prove long-term potential before scaling. So this is a quote about like their new strategy that they came out the CEO came out and announced the strategy and I was like oh isn't this like how the game industry already works? I think they finally just realized that they need to operate like a Scoply like a EA. They need to try new games. They need to expand their franchises. They need to do early access and soft launches and prove that it's successful before scaling it. I mean like this is how our industry works. The thing that I thought was really interesting is UGC. And so last summer they launched something called uh PUBG Alpha, which is their UGC experience. I don't know exactly how it's doing, but I imagine that's going to be a fantastic way to expand that franchise as you think about where it can go. In addition to what you said like Tac Shooter or other platforms, UGC also feels like the place to go given what you're seeing

inside of Fortnite and what you're seeing like you said with Rivals and shooter success on Roblox. So, makes a ton of sense. They have a lot of international presence. Freefire kind of owns a bit of the like Brazilian market and some of the lower markets, but PUBG has a lot of global footprint to it. And we'll definitely check in on FreeFire on Shooter Monthly, too, because FreeFire has been on an absolute [ __ ] tear and also has dipped its toes into the UGC space. You're seeing a lot of shooters kind of play around with, hey, can we make this
a platform? You know, of course, Ro, you know, Fortnite is the number one example, but it's but it's interesting to see everyone else tip their toes in. You know, Battlefield Portal exists, waiting to see Call of Duty do something, but that's also a game that's been on an absolute monster tear.
Yeah. I mean the tools that they're giving now like no code you just like you know kind of like go in and you just place things around and make your own map and your own customization making it really easy and accessible. It really deepens I think engagement and what you can have and giving people a way like to make up their own maps. The other thing

that really stood out here, just to do a dig against Larion, is that Craftton basically reiterated its AI first direction, which basically means using AI as a tool to improve development efficiency while freeing creative teams to focus on building what it calls the next generation of franchise scale games.
I just wanted to point this out. They are not worried about some backlash from some half morons on Reddit, right? They're looking, you know, it's [laughter] you use the tools that you're given, right, to make the best possible content. just enough of this nonsense.
I know. I again like why Arc Raiders came out and the CEO talked all about using AI in their pipeline to make content more efficient and better. Like I don't understand the cherrypicking of AI hate that happens from the Reddit mob. I just I don't get it. Like these are tools. Stop it everybody. like let's be thrilled that we can get more awesome games faster and more efficient and and that we all love to play. So,

but that's that's not an irrelevant point. There's actually really important mechanics that go into why that's the situation. Like the West always pays attention to the West. Like Craftton is not logging into subreddit as an additional tab on Chrome. And I can tell you almost every PC console developer I've worked with has an additional tab which is the subreddit for their game. They're obsessed with it. is the TMZ for their own game. They love the visceral feedback. And so when you pay attention to those people, they get inside your head and you're constantly managing the reactions. And Reddit has a very interesting paradigm where everyone aligns around a hive mind position and that position becomes the position. It's the same when it comes to monetization, right? Why does Valve get a free pass for having loot boxes in CSGO and yet when any other developer comes out with it, they get absolutely shhat on? Because there's no cons logical consistency is about keeping an agenda together. And if you remember, Twitter is also where there are a lot of Western artists. Western artists are the most active community on Twitter. And so they yell very loudly when these tools come

out. You never see a programmer coming out and saying, "Oh my god, I'm worried about these tools." Right? The focus is on the keyword generative AI. Right? No one's [ __ ] on the programmer who won't exist potentially because we have these AI tools. It's only the artists that we end up paying attention to and are the loudest. That's not an irrelevant point in this conversation. So you you are absolutely correct. So when I was at Riot on League of Legends, it's not just artists, it's it's like you said monetization and gameplay and some other things. So because League of Legends were based in the US, you're right. All the developers had read it up and they would come and they would be like, "We need to make this change. We read this on Reddit." And I was like, "Guys, I appreciate that we're getting the feedback. We need to get real consumer insights across all of our major markets, and not react to the US, which is one of our smaller markets. We have China, we have Korea, we have other markets that are bigger. We just can't overreact to what a couple of the vocal minority are saying on Reddit. And so what you have to do is take the insights

that you get from Reddit and go do real consumer insights. like stand at Beta Hat always says like you've got to go get stats sig research before you go and actually make any changes that you have. Now what that means is it takes more time. It's super helpful if someone's like, "Oh my god, something's broken or this is like an absolute dumpster fire and we need to deal with it." But for bigger issues, you got to do it right. So that's my caution to everyone. Phil, good point. Don't overreact to the vocal minority on Reddit.
And if you're an analyst, put it in the dashboards. What is the percent of Reddit subscribers or active readers as a percent of the games DAU? That is the most powerful thing you can do as an analyst. Bring context.
Oh, interesting. Yeah, it's a good one.