Game publisher Wemade loses 31.6 billion won in second quarter
Game publisher Wemade fell short of analyst expectations and lost 31.6 billion won ($24 million) in the second quarter of 2022, the company said Wednesday.
The loss was incurred mostly due to increased costs in marketing for its latest Mir M mobile game and staff salaries, according to a conference call held Wednesday morning. Mir M was released June 23.
The company’s April-to-June earnings fell short of a 21.4-billion-won market consensus compiled by FnGuide. It turned to red for the first time since the last quarter of 2020, when its marketing expenses went up to promote its Mir 4 online game.
During the latest quarter, the company spent 56.2 billion won on its employees’ paychecks — a 243 percent jump from 16.4 billion won during the same period last year. Marketing expenses came in at 24.5 billion won, 390 percent more than the year prior.
Revenue and operating profit also failed to meet analyst forecasts. Wemade posted 109 billion won in revenue, 58 percent higher than the previous year but lower than the 132.2-billion-won consensus, while operating loss stood at 33 billion won, also below the 3.6-billion-won consensus.
The company’s next quarter earnings will recover as Mir M’s sales will be fully included then, and the company will keep investing in new technologies despite the loss, said CEO Chang Hyun-guk during the conference call.
“It’s impossible to tell whether an investment has been successful or not just by looking at the short-term earnings reports,” Chang said. “Among the plethora of ideas that pour out in the beginning stages of a market, only the competitive few will survive and lead the industry."
BY YOON SO-YEON [email@example.com]