[Click eStock] NCSoft, It's Time to Wait for the Second Half

[Asia Economy Reporter Kwon Jae-hee] Korea Investment & Securities maintained a buy rating on NCSoft and set a target price of 920,000 KRW.

NCSoft's revenue in the fourth quarter of last year was 757.2 billion KRW, a 34.9% increase compared to the same period last year. Operating profit recorded 109.5 billion KRW, a 30.1% decrease during the same period.

Lineage M's revenue was 88.8 billion KRW, down 58.1% year-on-year. Although the performance was somewhat sluggish due to the prolonged service period and adjusted promotion intensity, traffic indicators remain stable.

Lineage 2M's revenue was 124.5 billion KRW, a 25.3% decrease compared to the same period last year. Domestic sales are stable, and sales in Japan and Taiwan have recently stabilized downward, so future sales trends are expected to be stable.

The highly anticipated title Lineage W recorded revenue of 357.6 billion KRW, significantly exceeding market expectations.

On the cost side, total operating expenses increased by 60.1% year-on-year to 647.7 billion KRW, with personnel expenses rising sharply to 256.2 billion KRW due to incentives related to Lineage W. Marketing expenses doubled from the previous quarter to 118.1 billion KRW.

This year, with the resumption of new releases in the second half, performance improvement is expected. The long-awaited project TL, developed by NCSoft for a long time, is scheduled for a global release in the second half. Additionally, new titles such as Project E and Project R will also be launched in the global market.

Jung Ho-yoon, a researcher at Korea Investment & Securities, analyzed, "Lineage W is scheduled to be released in the US and Europe in the second half of this year, and with blockchain technology such as NFT applied, great success is expected. From the first quarter, cost burdens such as personnel and marketing expenses will decrease, and performance improvement will begin."

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