Pearl Abyss FY2026 Q1 Earnings Letter

1Q26 Pearl Abyss Earnings Letter

Disclaimer
This presentation contains forward -looking statements that relate to our future operations,
prospects, developments, strategies, business growth, and financial outlook. Forward -looking
statements are identified by words such as ‘believes’, ‘estimates’, ‘expects’, ‘intends’, ‘may’,
‘projects’, ‘could’, ‘should’, ‘will’, ‘continue’ and other similar expressions.
All statements other than statements of historical fact could be forward -looking statements, which
speak only as of the date they are made, do not guarantee future performance and are subject to
certain risks, uncertainties, and other factors beyond our co ntrol and difficult to predict.
Also, Forward -looking statements are identified based on the current market situation and
company’s strategies, therefore, can be altered without notifications due to changes in market or
the company’s strategies.

Management Summary
Pearl Ab yss recorded strong performance in 1Q26, driven by the launch of Crimson Desert.
Crimson Desert ranked number one on Steam’ s Top Sellers across major countries, showing high
pre -sale volume despite being a new IP. In particular, the game solidified its position as a AAA game
by recording 2 mil lion copies on the first day of launch , 3 mi llion with in 4 days , 4 mil lion with in 12
days, and 5 mil lion with in 26 days. In addition, we enhanced the overall user experiences by adding
new content and improving user experience through patches based on user feedback.

The p erformance of Black Desert franchise was st able Qo Q, supported by its steady live service. In
1Q26, Black Desert PC focused on reinforcing its content by revamping guild boss es and ‘ Blue
Battlefield ’, while c onsole p rovided updates centered on improving PvP content and user
experience . In addition , Black Desert Mo bile improved the overall game play environment by
expanding user acces sibility through a PC -client , alongside graphic revamp through the remaster
version and UI simplif ication.

▶ 1Q26 Operating Performance
Operating revenue and profit increased s ubstantiall y, thanks to the successful launch of Crimson
Desert .
– Operating revenue posted KRW 32 8.5 billion , up 419.8 % YoY and 382.4 % QoQ .
– Operating profit posted KRW 212.1 billion , thanks to efficient marketing execution and
top -line growth .
– Net profit posted KRW 170.0 billion , benefiting from favorable FX rate s and revenue
growth.

13% 2% 26% 1%
65% 12% -28%
43% -6% 52%
(Unit: billion KRW , %)
YoY 419.8 %
QoQ 382.4 %
YoY 2,584.8%
QoQ 30,200.0%
YoY 2,107.8 %
QoQ Turn to profit
* Continuing operations basis (The sale s of Fenris Creations, former ly CCP games were completed on May 6, 2026)
(‘26 년 5/6 일자로 지분 전량 매각 )
63.2 55.4
86.0 68.1
328.5
1Q25 2Q25 3Q25 4Q25 1Q26
7.9 0.9 22.7 0.7
212.1
1Q25 2Q25 3Q25 4Q25 1Q26
Operating Revenue
7.7
(15.5)
37.3
(4.2)
170.0
1Q25 2Q25 3Q25 4Q25 1Q26
Net Profit(Loss) Operating Profit

▶Revenue Breakdown by IP
Operating revenue from Black Desert and Cri mson Desert posted KRW 61.6 billion , KRW 266 .5
billion respectively .
– Black Desert maintained stable revenue QoQ, driven by content opt imization and seasonal
events on PC , along with the PC client launch and remaster update on mobile .
– Crimson Desert revenue posted KRW 266 .5 billion , and the sales split between console
and PC is approximately 50:50. When it comes to revenue recognition , for console,
revenue is recognize d after deducting platform fees , while PC revenue is recognized after
deduc ting tax es from user pay ments. In addition, physical package revenue was lower
than sell -through volumes due to contract terms, while most production costs had already
been recognized in 1Q26 .

* Continuing operations basis

▶ Revenue Breakdown by Region and Platform
By region, NA/EU accounted for 81 %, Asia for 13 %, and Korea for 6%. The NA/EU share increased
by 25 %p QoQ , as more than 80% of the Crimson Desert sales occurred in the region. By platform,
PC accounted for 59 %, console for 38 %, and mobile for 3%. The c onsole share increased by 31 %p
QoQ following the launch of Crimson Desert .

* Continuing operations basis
1Q25 2Q25 3Q25 4Q25 1Q26 QoQ YoY Ratio
Revenue 63.0 54.9 79.5 63.0 328.1 420.8% 420.8% 100.0%
Black Desert 63.0 54.9 79.5 63.0 61 .6 -2.2% -2.2% 18.8%
Crimson Desert – – – – 266 .5 – – 81.2%
26% 26% 23% 23%
6%
25% 20% 19% 21%
13%
49% 54% 58% 56%
81%
1Q25 2Q25 3Q25 4Q25 1Q26
Korea Asia NA/EU
79% 84% 83% 76%
59%
4% 4% 7%
7% 38%
17% 12% 10% 17%
3%
1Q25 2Q25 3Q25 4Q25 1Q26
PC Console Mobile
Revenue by Region
(Unit: billion KRW , %) Revenue by IP
Revenue by Platform

▶ 1Q26 Operating Expenses
Operating expenses wer e KRW 116.4 billion , up 72.7 % QoQ .
– Labor expenses posted KRW 38.4 billion , up 28.9 % QoQ , due to an increase in annual
salar ies and the number of temporary workers hired for the Crimson Desert launch .
– Commissions posted KRW 42.5 billion , up 19 3.1 % QoQ, due to an increase in Crimson
Desert sale s from steam .
– Advertising expenses posted KRW 23.4 billion, up 15 1.6 % QoQ, due to higher Crimson
Desert marketing spending .

* Continuing operations basis

▶ Employees
The number of employee s stood at 1,024, up 6.1 % QoQ , due to an increase of temporary workers
hired for the Crimson Desert launch , so the number will decrease slightly in the next quarter as the
game was released in 1Q26 . In addition , in 2026, we plan to hire only essential positions while
maintaining a conservative approach to overall hiring .

* Continuing operations basis
1Q25 2Q25 3Q25 4Q25 1Q26 QoQ YoY Ratio % of Rev.
Operating Expenses 554 545 633 674 1,164 72.7 % 11 0.1% 100.0% 35.4 %
Labor 309 289 296 298 384 28.9% 24. 3% 33.0 % 11.7 %
Commissions 131 131 160 145 425 19 3.1 % 224. 4% 36.5 % 12.9 %
Advertising 39 49 102 93 234 15 1.6% 500 .0% 20.1 % 7.1 %
D&A 26 26 25 25 24 -4.0 % -7.7% 2.1 % 0.7 %
Other expense s 49 50 50 11 3 97 -14.2% 98 .0% 8.3 % 3.0%
1Q25 2Q25 3Q25 4Q25 1Q26 QoQ YoY Ratio
Employees 936 960 926 965 1,024 6.1 9.4 100.0
Development 491 500 482 519 673 14.3 19.5 65.7
Business/Staff 445 480 444 446 351 -6.7 -5.9 34.3
Operating Expense by Quarter (Unit: billion KRW, % )
(Unit: No. of employee, % ) Number of Employees

20 26 Outlook
2026 operating revenue is expected to come in at KRW 879.0~9 75 .4 billion.
– Operating revenue from Black Desert is projected to be KRW 234.9 ~2 40.6 billion, which is
approximately a decrease of 8~10 % YoY.
– Operating revenue from Crimson Desert is projected to be KRW 644 .1~734 .8 billion .

2026 operating profit is expected to record KRW 487.6~572.6 billion.
– Operating profit is expected to increase by 1,414.3~1,678.3% , thanks to stable Black
Desert performance and Crimson Desert launch, and o perating profit margin is anticipated
to improve to 55.5~58.7% .

2Q26 operating revenue is expected to come in at KRW 271.3 ~32 4.7 billion.
– Black Desert revenue is expected to decrease slightly QoQ , as we plan to provide updates
on improving user experience and hold events rather than major contents updates .
However, revenue is expected to rebound in 2H26 , as we plan to off er massive updates
after the Heidel ball in July.
– Crimson Desert revenue is exp ected to soften in 2Q26 given the nature of package sales ,
where initial sales are front -loaded . However, Cr imson Desert is expected to maintain
stable performance , supported by continuous patches and updates. In addition, we aim to
increase revenue by providing updates including difficulty adjustment , improved controls,
boss rematches and pet companion .

2Q26 operating profit is expected to record KRW 129 .6~176.7 billion .
– Labor expenses are expected to more than double QoQ , due to performance bonus
payment.
– Advertising expenses are expected to normalize to the lev el of the same quarter last year .
– Commissions are expected to decrease QoQ , as sales of Crimson Desert stabilize .

* The forecast s above are guidance figures for the game
* The above estimates may differ from actual re sults
1Q(A) 2Q(F) 2026(F)
Operating Revenue 32 8.1 271 .3~32 4.7 87 9.0~9 75 .4
Black Desert 61 .6 47 .1~48 .2 234 .9~240 .6
Crimson Desert 266 .5 224 .2~276 .5 644 .1~734 .8
Operating Expenses 116 .4 14 1.7~14 8.0 39 1.4 ~40 2.8
Operating Profit 211 .7 129.6 ~17 6.7 48 7.6 ~57 2.6
(OPM) 64.5 % 47.8 ~54. 4% 55. 5~58. 7%
2026 Guidance (Unit: billion KRW , %)

New Pipelines a nd Growth Strategy
Crimson Desert will continue to focus on enhancing user satisfaction and driving new sales through
continuous updates, while expanding its market presence through platform expansion. In addition,
we are currently exploring various ways to broaden the gam e to the next level including DLC. We
will share the details once the concrete plans are set.
Furthermore, DokeV and Plan 8, two new titles are in development. With the goal of maintaining a
new title release cycle of every 2 -3 years, w e will prio ritize resources on DokeV to accelerate
development. In addit ion , DokeV is currently in the pre -production stage, and we will share updates
as development progresses .
Plan 8 is currently in the conceptualization stage. While focusing resources on the development of
DokeV, we will strive to maintain the consistent release cycle.

Others
Our subsidiary, PAI (Pearl Abyss Iceland ehf. ) resolved at its board meeting on April 30 , 2026 to sell
its subsidiary , Fenris Creations (former ly CCP Ga mes ), to its current management , and the
transaction was completed on May 6, 2026. Both parties made efforts to strengthen global
competitiveness under the independent management s. However, we determined that sell ing the
shares to the current management would be mutually beneficial after a comprehensive review of
mid -to long -term growth strateg ies. Even after the transaction, we will continue to keep the
potential collaboration opportunities open with Fenris Creations .

※ Appendix
Consolidated Financial Statements (Comprehensive Income Statement )
1Q25 2Q25 3Q25 4Q25 1Q26
Revenue 63,225 55,385 85,973 68,132 328, 498
Operating Expenses 55,362 54,482 63,260 67,387 116,402
Operating Profit(Loss) 7,863 903 22,713 745 212, 096
Financial Income(Loss) 1,049 (18,559) 11,577 6,72 8 16,11 4
Other Income(Loss) (154) 76 (10 8) (48 1) (48)
Income(Loss) from Equity Method (218) (145) (15 8) (396) (165)
Income(Loss) before Income Tax 8,540 (17,725) 34,024 6,596 22 7,997
Income(Loss) Tax Expenses 873 (2,208) (3,274) 10,773 57,949
Net Profit from Continuing Operations 7,667 (15,517) 37,29 8 (4,17 7) 170,048
Net Profit(Loss) from Discontinued Operations (7,168) (7,183) (8,303) (11,032) (12,079)
Net Profit(Loss) 499 (22,700) 28,99 5 (15,20 9) 157,969
* Continuing operations basis
(Unit: million KRW )

Consolidated Financial Statements (Statement of Financial Position )
2025.12.31 2026.03.31
Assets
Ⅰ. Current Assets 444,796 990,820
Cash and cash equivalents 133,875 145,138
Account receivables 58,37 7 285,050
ST financial instruments 218,564 187,004
Financial assets measured at fair value 15,345 24,177
Other current assets 18,397 12,56 5
Assets held for sale 0 336,66 4
Inventory assets 238 222
Ⅱ. Non -Current Assets 704,303 422,97 7
Account receivables 3,968 1,847
LT financial instruments 138 142
Financial assets measured at fair value 169,971 182,920
AFS financial assets 15,698 15,971
Investment in affiliated companies 39,936 39,771
Tangible assets 178,058 163,821
Intangible assets 256,988 11,410
Investment property 4,465 4,450
Other non -current assets 618 510
Deferred tax asset 34,463 2,135
Total Assets 1,149,099 1,413,79 7
Liabilities
Ⅰ. Current Liabilities 135,652 357,453
Other payables 33,514 67,393
Lease liabilities 5,205 2,110
Income taxes payable 2,018 40,781
Current provisions 0 462
Other current liabilities 94,91 5 68,491
Liabilities associated with assets held for sale 0 178,216
Ⅱ. Non -Current Liabilities 214,344 94,60 4
Other payables 7,552 6,404
Long -term debt 56,200 71,200
Financial liabilities measured at fair value 18,166 0
Lease liabilities 13,324 4,406
Non -current provision 912 264
Other non -current liabilities 94,510 7,159
Deferred tax liabilities 23,680 5,171
Total Liabilities 349,996 452,057
Capital
Ⅰ. Capital stock 6,623 6,623
Ⅱ. Capital Surplus 219,742 220,852
Ⅲ. Retained Earnings 550,155 708,124
Ⅳ. Capital Adjustments (24,229) (24,143)
Ⅴ. Accumulated Other Comprehensive Income 46,812 50,284
Ⅵ. Non -controlling Interests 0 0
Total Capital 799,103 961,740
(Unit: million KRW )