NC Rebounds in Q1 with Lineage, New Titles Fuel Optimism [NC]

Lineage Classic Proves Its Popularity
Momentum Builds for New Titles in the Second Half

NC achieved first-quarter results that exceeded market expectations this year, driven by the success of "Lineage Classic." There are forecasts that ongoing releases of new titles will continue to improve the company's performance.

On May 14, Mirae Asset Securities raised its target price for NC by 42.9% to 400,000 won, citing this background, and maintained its "Buy" investment rating. The previous day's closing price was 263,000 won.

In the first quarter of this year, NC recorded sales of 557 billion won and operating profit of 113 billion won. Compared to the same period last year, sales increased by 54.7% and operating profit soared by 2,078.8%. Both figures exceeded market consensus, with sales surpassing the expected 524 billion won by 6% and operating profit outperforming the projected 95 billion won by 20%.

The strong performance was led by the success of Lineage Classic, which launched in February. First-quarter PC sales surged by 210% year-on-year to 318 billion won, beating consensus by 38%. Sales from Lineage Classic alone reached 83.5 billion won in the first quarter.

Mobile sales reached 183 billion won, a 14.1% decline from a year earlier. While Lineage M performed well, the results of Lineage 2M and Lineage W were sluggish. Operating expenses rose by 25% year-on-year to 444 billion won. As company-wide incentives were reflected in advance, labor costs climbed to 244 billion won, a 30% increase from the first quarter of last year.

With solid sales from Aion 2 and Lineage Classic, the strong performance is expected to continue into the second quarter. There are also upcoming regional expansions of existing intellectual properties (IP), such as the launch of Lineage W in Southeast Asia and the releases of Lineage M and Lineage 2M in China. In the fall, the global version of Aion 2 is scheduled to launch. New titles such as Cinder City, Time Takers, and Breakers have also entered global testing phases.

Heeseok Lim, an analyst at Mirae Asset Securities, stated, "The company is entering a period when it can simultaneously benefit from second-quarter performance momentum and the global launch momentum of Aion 2," adding, "The highly anticipated Horizon IP title is also expected to begin global testing in the second half of the year."

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