KRAFTON (259960) Q1 2025 earnings summary

Executive summary

• Achieved record-high Q1 2025 revenue of KRW 874.2 billion, up 31% year-over-year and 41.6% sequentially, driven by PUBG IP and new title INZOI.

• Operating profit reached KRW 457.3 billion, a 47% increase year-over-year and 112.2% sequentially, with a margin of 52.3%.

• Net profit was KRW 379.4 billion, up 7% year-over-year but down 24.4% sequentially, impacted by foreign exchange effects.

• INZOI sold over 1 million copies in seven days post-launch, with 95% of sales from global markets.

• PUBG continues to show robust growth in user base and engagement, with 1.4 million peak concurrent users after the eighth-anniversary update.

Financial highlights

• Q1 PC platform revenue: KRW 323.5 billion, up 33% year-over-year and 39% quarter-on-quarter.

• Q1 mobile platform revenue: KRW 532.4 billion, up 32% year-over-year and 47% quarter-on-quarter.

• Console platform revenue: KRW 13.1 billion, up 14% year-over-year and 7% quarter-on-quarter.

• Adjusted EBITDA for Q1: KRW 505.1 billion, up 33% year-over-year, with a margin of 57.8%.

• Operating expenses rose to KRW 416.9 billion, mainly due to higher personnel and platform fees.

Outlook and guidance

• Expect continued growth for PUBG and new IPs, with a focus on expanding into new genres, platforms, and regions.

• Unreal Engine 5 update and user-generated content for PUBG PC are in pre-production, with updates starting in the second half of the year.

• Subnautica 2 early access launch planned for the second half of 2025, with Xbox Game Pass partnership.

• Ongoing investment in AI technology to enhance gameplay and user experience.

• Confident in year-over-year growth for mobile revenue in Q2, despite seasonality.