NCSoft FY2025 Q1 Earnings Release

Q1 2025 Earnings Release
2025. 5. 14 NCSOFT IR

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The financial results for Q1 2025 have been prepared on an unaudited basis and may be
subject to change during an independent auditing process.
Please note that NCSOFT will not be responsible for individual investment decisions based
on this material.
※ Key Consolidated Subsidiaries (based on K -IFRS):
NCSOFT Corporation(HQ, KOR), NC West Holdings(100%, USA),
NC America(100%, USA), NC Europe(100%, GBR), NC Japan(100%, JPN),
NC Taiwan(100%, TWN), NCSOFT Service(100%, KOR), NC Dinos(100%, KOR),
NC ITS(100%, KOR), This Game Studio(40%, CAN), NC Vietnam Visual Studio(100%, VNM),
NCSOFT Asia Holdings(100%, SG), NC IDS(100%, KOR), NC QA(100%, KOR),
FirstSpark Games Co., Ltd.(100%, KOR), BigFire Games Co., Ltd.(100%, KOR),
Ludius Games Co., Ltd.(100%, KOR), NC AI Co., Ltd.(100%, KOR)

Disclaimer

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Contents
I. Consolidated Earnings
1. Financial Highlights
2. Sales Breakdown
3. Cost Breakdown
II. Appendix
4. Consolidated Financial Statements
5. FY 2026 Sales Guidance

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1. Financial Highlights
25,723 8,844
(14,291)
(129,491)
5,220
1Q 24 2Q 24 3Q 24 4Q 24 1Q 25
Operating Profit
TTP QoQ
↓ 80% YoY
↓ 12% QoQ
↓ 9% YoY
Quarterly Performance
(Unit : KRW MN)
397,911 368,869 401,937 409,407 360,278
1Q 24 2Q 24 3Q 24 4Q 24 1Q 25
Sales
TTP
↓34% YoY
TTP QoQ
↓60% YoY
78,365 84,912
(32,036) (10,334)
31,252
1Q 24 2Q 24 3Q 24 4Q 24 1Q 25
Pre -tax Income
Sales reported KRW 360.3 billion, down 12% qoq and 9% yoy
Operating profit turned around to KRW 5.2 billion as the impact of severance costs in the previous quarter subsided
57,122 71,107
(26,524) (7,588)
37,507
1Q 24 2Q 24 3Q 24 4Q 24 1Q 25
Net Income

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Mobile game sales declined 4% qoq to KRW 206.3 billion, accounting for 57% of total sales
Legacy online PC game sales declined 11% qoq to KRW 83.3 billion, representing 23% of total sales
2. Sales Breakdown (by Game)
105,125 106,974
158,891 121,770 112,710
55,872 42,289
43,143
41,263 37,876
82,857
65,472
46,866
49,086 53,097
5,582
3,493
4,491
3,506 2,595
249,436
218,228
253,391
215,624 206,278
1Q 24 2Q 24 3Q 24 4Q 24 1Q 25
Lineage M Lineage 2M Lineage W Blade & Soul 2
Mobile Games
(Unit : KRW MN)
24,250 24,554 26,455 22,943 22,300
23,460 21,221 20,216 20,569 19,089
14,256 13,113 11,820 11,195 8,499
4,120 3,832 3,220 13,967 14,179
25,370 23,480 19,016
24,720
19,259
91,456 86,200 80,727
93,394
83,327
1Q 24 2Q 24 3Q 24 4Q 24 1Q 25
Lineage Lineage 2 AION Blade & Soul Guild Wars 2
PC Online Games
(Unit : KRW MN)
* Not including other mobile games * Not including other PC online games

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1Q 24 2Q 24 3Q 24 4Q 24 1Q 25
Total 397,911 368,869 401,937 409,407 360,278
Royalty 32,686 37,668 38,107 73,538 44,955
NA/EU 36,637 33,950 28,242 35,366 30,897
Asia 69,164 56,926 49,378 52,025 56,108
Korea 259,424 240,324 286,210 248,479 228,318
397,911 368,869 401,937 409,407
360,278
2. Sales Breakdown (by Region)
Korea sales declined 8% qoq to KRW 228.3 billion
Asia sales grew 8% qoq to KRW 56.1 billion, driven by increased sales of Lineage W
Royalty sales declined 39 % qoq due to the diminishing impact of TL’s global release but rose 38% yoy to KRW 45.0 billion
Sales by Region
(Unit : KRW MN)

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1Q 24 2Q 24 3Q 24 4Q 24 1Q 25
Total 372,188 360,025 416,228 538,897 355,058
Variables & Others 134,740 126,795 139,949 143,236 129,389
D&A 27,767 27,879 26,504 25,931 25,147
Marketing 6,901 17,378 48,656 55,248 13,329
Labor 202,780 187,973 201,120 314,483 187,192
372,188 360,025
416,228
538,897
355,058
Total operating expenses for Q1 decrease d34% qoq to KRW 355.1 billion
Labor cost decreased 40% qoq to KRW 187.2 billion ,as the impact from the previous quarter’s severance costs tapered off
Marketing expenses decrease d76% qoq to KRW 13.3 billion
3. Cost Breakdown
Cost Breakdown
(Unit : KRW MN)

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FY 2024 1Q 25
Liabilities
I. Current Liabilities 322,188 368,172
Borrowings – –
Account payables 70,549 89,686
Lease liabilities 45,845 45,252
Current tax liabilities 721 1,092
Other current liabilities 193,718 222,000
Liabilities held for sale 11,354 10,142
II. Non -current Liabilities 568,165 494,655
Debentures and borrowings 169,805 169,820
Defined benefit obligations 1,263 1,201
Long -term employee benefits 21,033 21,477
Lease liabilities 163,806 161,338
Others 212,256 140,819
Total Liabilities 890,353 862,827
Shareholders Equity
Capital Stock 10,977 10,977
Other Paid -inCapital (365,222) (239,101)
Other Components of Equity (61,168) (115,047)
Retained Earnings 3,473,871 3,357,541
Non -controlling Interest 5,130 4,876
Total Stockholders Equity 3,063,589 3,019,245
Total Liabilities and
Shareholders Equity 3,953,941 3,882,073
Statement of Financial Position
4. Consolidated Financial Statements
(Unit : KRW MN)
FY 2024 1Q 25
Assets
I. Current Assets 1,788,537 1,822,166
Cash and cash equivalents 1,260,473 464,239
Short -term financial
instruments 178,293 379,231
Account receivables 130,279 148,573
Other receivables 36,941 22,543
Short -term investment assets 39,816 667,637
Non -current assets
held for sale 87,425 87,425
Others 55,309 52,518
II. Non -current Assets 2,165,404 2,059,907
Long -term loans 8,050 600
Other receivables 22,131 21,936
Long -term investment assets 813,452 684,143
Investment stock in
associated companies 50,198 62,616
Investment property – –
Tangible assets 997,620 1,002,581
Intangible assets 103,873 104,864
Others 170,079 183,167
Total Assets 3,953,941 3,882,073

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1Q 24 2Q 24 3Q 24 4Q 24 1Q 25
Sales 397,911 368,869 401,937 409,407 360,278
Operating Expenses 372,188 360,025 416,228 538,897 355,058
Operating Income 25,723 8,844 (14,291) (129,491) 5,220
Non -operating Income 52,642 76,069 (17,744) 119,156 26,032
Pre -tax Income 78,365 84,912 (32,036) (10,334) 31,252
Income Tax 21,244 13,806 (5,512) (2,746) (6,255)
Net Income 57,122 71,107 (26,524) (7,588) 37,507
Equity Attribution to the
Owners of the Parent Company 57,176 70,994 (26,500) (7,455) 37,760
Non -controlling Interest (55) 112 (23) (134) (253)
4. Consolidated Financial Statements
Income Statement
(Unit : KRW MN)

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1.8
1.6
FY 2023 FY 2024
5. FY 2026 Sales Guidance
Through continued expansion of Legacy IPs and new title launches, sales in FY 2026 are expected to reach KRW 2.0 trillion ,
with potential upside to KRW 2.5 trillion depending on the success of the new releases
FY 2026 Sales Guidance
(Unit : KRW TN)
FY 2026 Sales Guidance Breakdown
(Unit : KRW TN)
Category FY 2026 Sales Guidance

Diversified live game services
Regional expansion
Spin -off games
IP licensing
1.4 -1.5

In-house developments
External IP publishing
0.6 -1.0
Total Sales 2.0 -2.5
FY 2026 (E)
2.0 ~ 2.5