NCsoft offers employees voluntary resignation as profit continues to plunge

Industry

Published: 09 May. 2024, 19:13 Updated: 09 May. 2024, 21:26

NCsoft offers employees voluntary resignation as profit continues to plunge

NCsoft's headquarters in Pangyo, Gyeonggi [NCSOFT]

NCsoft is offering voluntary resignation packages as part of efforts to downsize its workforce in response to pressure from shareholders to trim fixed expenses as the company's profitability continues to decline.

Co-CEO Park Byung-moo said in an internal briefing on Thursday that the company has been “strongly pressed” by shareholders to cut its costs and aims to scale down its number of employees to the mid-4,000s. NCsoft had 5,023 employees as of the end of last year, according to the company’s March regulatory filing.

The voluntary resignation program is expected to run its course within this month.

The firm also plans to purchase 98 billion won ($71.5 million) worth of its own stock, or 533,417 shares, beginning Friday to Aug. 8.

“NCsoft, as a company with annual revenue in the 2 trillion won range, has experienced a rapid surge in organization and personnel during its compressed growth stage,” Park said. “Following the Covid-19 pandemic, however, the entire gaming industry is entering a period of stagnant growth, and our main genre, massively multiplayer role-playing games, is facing even tougher times due to intensified market competition.”

The company underwent a large-scale restructuring at the end of last year, during which about 20 percent of executives resigned.

NCsoft intends to spin off some major divisions by the end of this year.

“Compared to other companies, NCsoft has a relatively large number of personnel and a high concentration of them at its headquarters,” Park said. “We are currently reviewing a spinoff of certain divisions to be completed by the end of this year.

“As the CEO, I’m responsible to save the company from crisis and transform it into a stronger NCsoft, gaining the trust of employees, shareholders and the world,” Park continued. “I understand that amid the various changes the company is pursuing, employees may feel both anticipation and anxiety. When clear understandings are needed during the process of change, I will create sessions like today.”

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]