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FY2022 1Q Financial Results Briefing

GREE Inc. reported FY2022 first‑quarter results with net sales of ¥13.7 billion and operating income of ¥1.6 billion, both figures reflecting a shift to a two‑segment reporting structure: Internet and Entertainment Business (games, metaverse, advertising) and Investment and Incubation Business. Operating income for the Internet segment reached ¥0.5 billion, surpassing forecasts, while the Investment segment contributed a significant profit margin that offset declines in game sales following anniversary events for flagship titles such as Another Eden and SINoALICE. Total costs amounted to ¥12.1 billion, down ¥0.6 billion quarter‑on‑quarter, with advertising expenses rising by ¥0.30 billion due to metaverse promotion and variable costs falling as sales dipped. The company highlighted new game releases, notably “That Time I Got Reincarnated as a Slime,” which entered the top‑10 app sales ranking, and pre‑registrations for “Heaven Burns Red.” Metaverse activity expanded the REALITY platform’s content and global user base, while advertising and media collaborations (e.g., aumo, LIMIA) continued to strengthen community engagement. Investment activities were detailed: assets under management stood at ¥43 billion, with a valuation of invested startups around ¥67 billion; direct investments totaled ¥31.1 billion, reflecting unrealized gains that roughly doubled the invested capital. GREE announced a stock‑repurchase program of up to 35 million shares (¥35 billion) to enhance shareholder returns and drive ROE toward 10%+. The outlook for Q2 anticipates operating income in the several‑hundred‑million‑yen range, tempered by higher outsourcing and advertising costs linked to new titles and metaverse growth.

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GREE

FY2022 Third Quarter Financial Results

The FY2022 third‑quarter financial results demonstrate robust performance in the Internet and Entertainment Business, driven by a strong launch of “Heaven Burns Red.” Net sales rose to ¥20.8 billion, up 1.34 % QoQ and 4.61 % YoY, while operating income reached ¥3.6 billion, a 1.05 % QoQ increase and 0.01 % YoY growth, reflecting successful promotion and a favorable sales mix. EBITDA matched operating income at ¥3.8 billion, indicating efficient cost management. The Investment and Incubation Business contributed a stable ¥0.4 billion to operating income, supporting long‑term value creation. Cost analysis shows total expenses increased by ¥0.3 billion QoQ, primarily due to higher advertising spend (¥1.87 bn) and a one‑time office relocation cost, yet variable costs remained controlled. Net income for the quarter was ¥2.95 billion, a 1.17 % QoQ rise but a 2.13 % YoY decline, largely attributable to lower investment gains compared with FY2021. Geographically the results cover Japan and global markets, with the Metaverse platform “REALITY” expanding features and initiating worldwide distribution. The company maintains a dividend policy of 2 % DOE, forecasting ¥11 per share for FY2022. Asset‑under‑management figures show a 4.5 bn yen QoQ increase to ¥71.4 bn, driven by gains in the GREE LP Fund and CVC investments. Methodologically, figures derive from consolidated financial statements, with detailed cost breakdowns and investment performance metrics provided. The report projects continued sales and income growth in the Internet and Entertainment segment for FY2022, while acknowledging a YoY decline in investment‑related gains.

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GREE

FY2018 First Quarter Financial Results

The quarterly results demonstrate a robust first‑quarter performance for FY2018, with net sales reaching ¥21.6 billion and operating income of ¥2.7 billion, reflecting a 17.1 % year‑over‑year increase and a 25 % quarter‑on‑quarter rise in sales. EBITDA stood at ¥3.1 billion, up from a negative figure the previous quarter, underscoring improved profitability after a sharp rebound in operating income. The company attributes growth to full‑scale operation of existing hit titles, aggressive media investment, and the launch of a new title in October. Advertising spend surged to ¥2.33 billion, driven by media‑operations expansion and promotional activities such as TV commercials, while labor costs fell due to overseas base closures. Financial forecasts for the first half of FY2018 project net sales of ¥40.5 billion and operating income of ¥4.5 billion, assuming a temporary dip in sales from mature titles and conservative earnings targets for new releases. The company plans continued investment in advertising to support high‑growth business segments. Operationally, the native game portfolio expanded from one released title to five in development, including first‑party and third‑party IPs. Existing titles received major updates and large‑scale collaborations, boosting coin consumption to 15 billion units in the quarter. The advertising and media arm reported a 2.4× QoQ increase in page views, driven by the LIMIA app’s growth to over one million monthly active users. Geographically, revenue is split between domestic and overseas markets, with overseas operations contributing a growing share of sales. The company’s headcount totaled 1,424 employees across game entertainment, advertising, and corporate functions. Overall, FY2018 Q1 results indicate strong top‑line momentum, improved profitability, and a strategic focus on expanding both domestic and international market presence.

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GREE

Consolidated Financial Results for the Three Months Ended June 30, 2024

The quarterly consolidated financial results for the three months ended June 30, 2024 show a mixed performance. Net sales fell 3.8 % to ¥17,607 million from ¥18,297 million in the same period a year earlier, driven by a decline in mobile‑sector revenue and lack of new smartphone titles. Operating profit dropped 23.8 % to ¥5,723 million as operating costs rose with an expanded in‑house mobile title roster. Despite lower operating income, ordinary profit increased 27.3 % to ¥18,703 million and net income attributable to owners rose 29.2 % to ¥13,638 million, setting record quarterly highs for both metrics. The company’s balance sheet strengthened: total assets rose to ¥255,675 million from ¥245,802 million, while net assets increased to ¥177,753 million. Capital adequacy improved from 71.1 % to 69.2 %, and net assets per share climbed to ¥560.38. Shareholders’ equity remained solid at ¥167,733 million, with retained earnings slightly lower due to a higher dividend payout. Segment analysis indicates the entertainment segment generated ¥16,581 million in sales and ¥5,701 million in profit, supported by repeat sales of “Rise of the Ronin” and ongoing development of new titles such as “FAIRY TAIL 2.” The amusement, real‑estate, and other segments contributed modestly to overall performance. For the fiscal year ending March 31, 2025, the company forecasts net sales of ¥90,000 million (up 6.4 %) and operating profit of ¥30,000 million (down 12.6 %). Ordinary profit is projected at ¥40,000 million (down 11.2 %) with net income attributable to owners at ¥30,000 million (down 11.2 %). Earnings per share are expected to be ¥95.04, reflecting a modest decline in profitability relative to the prior year. The forecast includes no revisions to dividend policy or consolidation scope, and accounting policies remain unchanged.

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Koei Tecmo