NEXON Co., Ltd. Q3 FY2024 Earnings Call

· Earnings call transcript and AI-powered summary

  • Q3 2024 Revenue: ¥135.6 billion – Record-breaking quarterly revenue, up 13% YoY (12% on constant currency basis).
  • Q3 Operating Income: ¥51.5 billion – Record-breaking Q3 operating income, up 11% YoY.
  • Q3 Net Income: ¥27 billion – Down 23% YoY, impacted by ¥19.6 billion FX loss.
  • Dungeon&Fighter Franchise: Revenue up 142% YoY driven by Dungeon&Fighter Mobile in China. Mobile title stabilized, preparing for major New Year update in Q1 2025. PC version remains challenging with updates planned to revitalize player experience.
  • MapleStory Franchise: Revenue declined YoY due to extraordinarily strong comparison base in Q3 2023. However, international regions grew 23% YoY and achieved record Q3 revenue, supported by a hyper-localization strategy.
  • The First Descendant: Launched July 2; 75% of revenue from Western markets. Despite initial strength, user traffic declined quicker than expected. Update pipeline aimed at recovery and long-term engagement.
  • FC Franchise: Revenue down YoY due to high prior-year comparison. Double-digit revenue growth expected in Q4, with strong positioning in South Korea.

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Junghun Lee: [Call starts abruptly] Thank you, Kawai-san and good afternoon, everyone. Earlier today, NEXON posted a quarterly investor letter with details on our recent performance and outlook. Before taking your questions today, I would like to offer some context on how these results align with the midterm growth plan which was present at NEXON's Capital Market reporting in September. Q3 reinforced our confidence in NEXON's growth strategy for building on the success of proven franchises and adding to our portfolio of blockbuster franchises. These investments, including the ongoing content updates and service improvements provided by our live operations teams, are much more than simple purchase or short-term improvements to our performance [ph]. It is designed to extend the fun for players while improving revenue and profitability over long periods of time. The incremental progress is evident in our Q3 results, while our top line was slightly below the outlook due to negative impact from FX. NEXON delivered record-breaking quarterly revenue at ¥135.6 billion, up 13% year-over-year and record-breaking Q3 operating income at ¥51.5 billion, up 11% year-over-year. We delivered solid progress on our IP growth strategy, including 15% aggregate year-over-year vertical growth in 3 major franchises, plus horizontal growth from a new IP, The First Descendant. The Dungeon&Fighter franchise delivered 142% growth year-over-year due primarily to the launch of Dungeon&Fighter Mobile in Ch

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