Krafton Tops Operating Profit as Gap Widens Between Large and Mid-Sized Game Makers

As first-quarter earnings reports from major Korean game companies have been completed, a clear performance gap is emerging between firms. Krafton posted the highest operating profit among domestic game makers, while Nexon led in revenue. Large companies delivered strong results, but some mid-sized firms posted weak numbers, prompting the industry to accelerate organizational streamlining to cut costs.
According to the gaming industry on the 18th, Krafton reported revenue of 1.3714 trillion won and operating profit of 561.6 billion won in the first quarter. By operating profit, it narrowly beat Nexon, which posted 542.6 billion won, to take the lead among major Korean game companies. Games based on the PUBG: Battlegrounds intellectual property drove sales past 1 trillion won. In terms of revenue, Nexon set a new quarterly record. First-quarter revenue rose 34% from a year earlier to 1.4201 trillion won, helped by overseas sales that jumped 59% year on year, led by Arc Raiders, which surpassed 16 million cumulative global sales in just six months after launch.
NCSoft and Pearl Abyss both delivered earnings surprises. NCSoft posted first-quarter revenue of 557.4 billion won and operating profit of 113.3 billion won, helped by the success of AION 2 and Lineage Classic. Revenue rose 55% from a year earlier, while operating profit surged 2,070%. Pearl Abyss also benefited from its new title Crimson Desert, recording revenue of 328.5 billion won and operating profit of 212.1 billion won. That marked increases of 419.8% in revenue and 2,584.8% in operating profit from a year earlier. Netmarble reported first-quarter revenue of 651.7 billion won, up 4.5% from a year earlier, while operating profit rose 6.8% to 53.1 billion won.
By contrast, some mid-sized game companies saw declining results, deepening the divide within the industry. Large firms with strong capital bases and global IP are generating stable profits, while others are facing rising cost burdens and deteriorating profitability. Kakao Games, for example, posted revenue of 82.8 billion won and an operating loss of 25.5 billion won in the first quarter, marking its sixth consecutive quarter in the red.
As the earnings gap widens and business uncertainty increases, game companies are moving faster to improve their fundamentals. After CookieRun: OvenSmash, launched in March, fell short of expectations, Devsisters plans to restructure its portfolio around profitability and growth potential and build an AI-based work system. Devsisters posted an operating loss of 17.4 billion won in the first quarter, widening its deficit by about 40% from the previous quarter. Revenue also fell about 34% from a year earlier to 58.5 billion won.
Large companies have also been managing risks proactively in recent years. NCSoft and Krafton have continued organizational streamlining efforts, including spin-offs and workforce reassignments. Even Nexon, which posted record results last year, has recently had chairman Patrick Söderlund directly emphasize the need for greater efficiency.
wongood@fnnews.com Juwon Gwon Reporter