Wemade Laughs with Mir4... Pearl Abyss Cries Over Labor Costs (Summary)

Mid-sized Game Companies Show Mixed Q1 Earnings Results

Jang Hyun-guk, CEO of Wemade

[Asia Economy Reporter Buaeri] The first-quarter earnings of mid-sized game companies showed mixed results this year. While Wemade achieved its highest quarterly performance since its founding, Pearl Abyss saw a significant decline in operating profit due to increased labor costs and other factors.

Wemade announced on the 12th that it recorded sales of 76 billion KRW and operating profit of 27.5 billion KRW in the first quarter. This represents a 147% increase in sales and a 755% increase in operating profit compared to the same period last year. Wemade's strong performance was driven by ‘Mir4,’ which alone generated 45.6 billion KRW in sales.

Wemade plans to continue this momentum. The company is preparing for the global service of Mir4, including Taiwan and Japan, and the global version will be based on the blockchain platform WEMIX, applying NFT (Non-Fungible Token) technology for the service.

Jang Hyun-guk, CEO of Wemade, said, "This first quarter is very meaningful as we have achieved the best results in Wemade's history as promised last year," adding, "The future Wemade is pursuing is to evolve into a metaverse (game) and virtual asset company in line with changes in the world, turning the flow of change into an opportunity."

Jung Kyung-in, CEO of Pearl Abyss

On the other hand, Pearl Abyss saw a sharp decline in both sales and operating profit in the first quarter. Sales dropped 24.2% year-on-year to 100.9 billion KRW, and operating profit decreased by 71.7% to 13.1 billion KRW. The performance of Pearl Abyss's flagship title ‘Black Desert’ was only partially reflected, and labor costs increased by 11% compared to the previous quarter. Earlier, Pearl Abyss raised all employees' salaries by 8 million KRW in March in response to the industry's salary increase trend and paid an additional 2 million KRW bonus. Of this, the 2 million KRW bonus was reflected in the first-quarter results.

Pearl Abyss plans to showcase stable live services of the Black Desert IP and 'EVE' in the second quarter based on its global publishing capabilities. The company will also focus on developing new titles such as Red Desert and Dokkaebi. Jo Seok-woo, Pearl Abyss's Chief Financial Officer (CFO), said, "We will focus on preparing for the successful launch of Red Desert based on steady financial performance."

Song Byung-jun, Chairman of Gamevil and Com2uS

Com2uS also delivered somewhat disappointing results. Com2uS posted sales of 116.7 billion KRW and operating profit of 17.7 billion KRW in the first quarter. While sales increased by 18.7% compared to the same period last year, operating profit decreased by 25.3%. The company explained that the decline in operating profit was due to increased marketing expenses for ‘Summoners War: Lost Centuria’ and increased labor costs from hiring additional staff.

Com2uS plans to strengthen its lineup across various genres based on existing hits such as Summoners War and its baseball game series. Through this, it aims to accelerate its global market expansion and achieve 1 trillion KRW in global sales by next year. A Com2uS representative stated, "We will actively pursue investments and mergers and acquisitions (M&A) in promising companies related to intellectual property (IP) of flagship games like Summoners War, digital content, and the metaverse to grow into a global comprehensive content company."

Gamevil, the parent company of Com2uS, recorded sales of 32.1 billion KRW and operating profit of 8.4 billion KRW in the first quarter. While sales decreased by 8.2%, operating profit increased by 35.1%. Neowiz, which also announced its first-quarter results on the same day, posted sales of 71.4 billion KRW, up 8% year-on-year, but operating profit decreased by 2% to 13.4 billion KRW.

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