Nexon leads as Korean game developers show diverging fortunes in Q1

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Nexon leads as Korean game developers show diverging fortunes in Q1

Published: 15 May. 2025, 14:57 Updated: 15 May. 2025, 15:06

Audio report: written by reporters, read by AI

The developers behind The First Berserker: Khazan, an action role-playing game by Nexon's subsidiary Neople, speak during a press conference held at the Nexon headquarters in Seongnam, Gyeonggi, on March 24. [YONHAP]

Nexon, the first Korean game developer to surpass 4 trillion won ($2.86 billion) in annual revenue last year, once again enjoyed its lead into the first quarter of this year, while NCsoft — once considered a bellwether stock in the Korean gaming sector — narrowly avoided a loss, continuing its slump.

With NCsoft, Wemade and Pearl Abyss releasing their first-quarter earnings on Wednesday, all major Korean game publishers have now reported their results. Nexon, listed on the Tokyo Stock Exchange, announced on Tuesday that it earned 1.08 trillion won in revenue and 395.2 billion won in operating profit during the first quarter — up 5 percent and 43 percent, respectively, from a year earlier.

The results mark a rebound from a lackluster fourth quarter, when the company missed market expectations with 753.8 billion won in revenue and 40.5 billion won in operating profit.

NCsoft’s first-quarter earnings, by contrast, declined sharply. The company posted 360.3 billion won in revenue, down 9.5 percent on-year, and 5.2 billion won in operating profit, a 79.7 percent drop. While reduced severance payouts stemming from a large-scale voluntary retirement program last year helped it avoid a net loss, the company’s first-quarter revenue has halved since reaching 790.1 billion won three years ago.

A showcase event for the release of NCsoft's multiplayer online role-playing game Lineage2M takes place in southeast Asia on March 31. [YONHAP]

Other major publishers also showed a wide performance gap. Krafton reported 874.2 billion won in revenue and 457.3 billion won in operating profit during the January-to-March period, marking year-on-year increases of 31.3 percent and 47.3 percent, respectively — its best-ever results.

Netmarble exceeded market expectations with 623.9 billion won in revenue and 49.7 billion won in operating profit.

However, Kakao Games, once a top-five player in the industry, posted 122.9 billion won in revenue and a 12.4 billion won operating loss, marking its second consecutive quarterly deficit.

The strongest performers maintained user engagement through popular updates to existing titles while launching successful new ones. Nexon benefited from the resurgence of long-running franchises Dungeon & Fighter and MapleStory, alongside FC Online. Combined revenue from these three franchises rose 21 percent year-over-year during the first quarter of 2025.

New releases such as The First Berserker: Khazan and Mabinogi Mobile, launched in March, further boosted sales. Mabinogi Mobile was particularly successful, ranking among the top two on both major app marketplaces.

Netmarble also saw gains from Solo Leveling: Arise, which rebounded following a major update late last year. The March debut of RF Online Next contributed to its results as well. Across the board, legacy titles pulled and new releases pushed growth.

Underperforming companies faced declining interest in their core titles, compounded by delays or underwhelming launches of new games. NCsoft saw revenue fall 4 percent in mobile games and 11 percent in PC games due to waning popularity of its flagship Lineage series. New titles like Hoyeon, released last year, also failed to gain traction.

Kakao Games similarly struggled as its hit title Odin: Valhalla Rising lost steam and its new game Valhalla Survival, released last month, fell short of expectations.

The Solo Leveling: Arise Championship 2025 takes place at the Ivex Studio in Gwangmyeong, Gyeonggi, on April 12. [YONHAP]

Still, both firms are placing big bets on upcoming releases. NCsoft has begun marketing its new multiplayer online role-playing game (MMORPG) Aion 2, set to launch in the second half of this year.

Kakao Games is also preparing to release the MMORPG Chrono Odyssey and action role-playing game (RPG) Goddess Order. With mounting pressure, both companies are treating these launches as critical to reversing their fortunes.

Other game makers also endured a difficult first quarter, largely due to delays in their most anticipated titles. Pearl Abyss, focused on the upcoming Crimson Desert, posted 83.7 billion won in revenue and a 5.2 billion won operating loss, reversing last year’s profit.

Wemade saw game-related revenue drop 8 percent, resulting in an 11.3 billion won operating loss. Webzen, facing a lack of new content, saw operating profit fall 50 percent to 8.9 billion won.

On a brighter note, Shift Up posted a 1.2 percent rise in operating profit to 26.3 billion won, supported by steady sales of Goddess of Victory: Nikke and Stellar Blade. NHN also reported a 1.3 percent increase to 27.6 billion won in operating profit, buoyed by strong performance in PC web board games and Japanese mobile titles.

BY YUN JUNG-MIN [[email protected]]