Nexon Faces Q1 Earnings Slump Due to Decline in China Sales... Seeks Rebound with 'Dungeon & Fighter Mobile' (Comprehensive)

Due to COVID-19, Chinese PC bangs closed causing Dungeon & Fighter sales decline
MapleStory and V4 perform well in Korean market with record quarterly results
Dungeon & Fighter Mobile launch targeted in China this summer

[Asia Economy Reporter Jin-gyu Lee] Nexon showed a sluggish performance in the first quarter due to a decline in sales in China and the absence of hit new releases. However, in the Korean market, it achieved the highest quarterly performance ever thanks to the strong performance of titles like MapleStory and V4. In the second quarter, Nexon plans to rebound by launching its ambitious mobile title, Dungeon & Fighter (DNF) Mobile, in the Chinese market.

◆ Decline in China sales and absence of hit new releases = On the 13th, Nexon announced that its first-quarter sales decreased by 11% year-on-year to 904.5 billion KRW (82.8 billion JPY), and operating profit fell by 21% to 454 billion KRW (41.5 billion JPY). This was mainly due to a decrease in DNF’s sales in China, which accounts for a large portion of Nexon’s total revenue. The spread of COVID-19 led to the temporary closure of PC bangs in China, significantly reducing DNF usage, causing Nexon’s China sales to drop by 39% compared to the same period last year. DNF serves as a cash cow, accounting for 50% of Nexon’s total sales and over 90% of its China sales. Additionally, although Nexon launched the mobile game Counterside in February, it did not see a significant boost from the new release, and the lack of hit new titles also contributed to the decline in performance.

◆ Record-high quarterly performance in Korea = On the other hand, Nexon achieved its highest-ever quarterly performance in the Korean market thanks to steady growth in major steady-seller games such as MapleStory, FIFA Online 4, and Sudden Attack, as well as increased sales from mobile games like V4. MapleStory introduced various contents through a large-scale winter update, and the mobile version, MapleStory M, also set a quarterly sales record with growth rates of 132% and 184% year-on-year, respectively, following the release of new characters. DNF also recorded a 53% sales increase year-on-year in Korea due to level cap expansion and the third awakening update. Sudden Attack saw a 52% sales growth year-on-year thanks to content updates. V4 maintained a top ranking in mobile game charts through successful promotions since its launch, leading to consecutive quarterly growth in mobile game sales. Thanks to V4, Nexon’s domestic mobile game sales achieved a high growth rate of 89% year-on-year.

◆ Betting on 'DNF Mobile' = Nexon is in the final stages of preparation to launch DNF Mobile in the Chinese market this summer. DNF Mobile is a 2D action RPG optimized for mobile platforms while preserving the strengths of the original game. Pre-registrations in China have already surpassed 34 million as of this date, generating high expectations even before release. Nexon also plans to launch FIFA Mobile domestically in the first half of the year, following the global release of the mobile racing game KartRider Rush Plus yesterday. KartRider Rush Plus topped the popularity charts on both Google Play and Apple App Store in Korea and Taiwan just one day after its release, signaling strong popularity. Owen Mahoney, CEO of Nexon Japan, said, "We are successfully building a portfolio that can maintain a steady flow regardless of external conditions," adding, "We will focus our capabilities on the successful launch and stable service of major titles scheduled for release this year."

This content was produced with the assistance of AI translation services.