Netmarble (251270) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached KRW 782.1 billion, up 33.6% quarter-over-quarter and 29.6% year-over-year, the highest since IPO, driven by new game launches and cost restructuring.

• EBITDA was KRW 151.1 billion, up 253.9% quarter-over-quarter and 1,299.1% year-over-year, with an EBITDA margin of 19.3%.

• Operating income was KRW 112.2 billion and net income KRW 162.3 billion, with controlling shareholders' net profit at KRW 169.5 billion, boosted by asset liquidation.

• Net profit surged due to non-operating income from liquidation of holding assets.

Financial highlights

• Q2 revenue and EBITDA were the largest since IPO, driven by successful new title launches and cost restructuring.

• Royalty expenses reduced to 33.6% of revenue, down 5.2 percentage points quarter-over-quarter, aided by increased PC platform revenue.

• Personnel expenses averaged KRW 181.1 billion in H1 2024, down from KRW 194.9 billion in 2022.

• Marketing expenses were KRW 143.7 billion, reduced to 17.9% of revenue in H1 2024 despite new launches.

• Operating cost was KRW 670.9 billion, up 15.3% quarter-over-quarter and 4.7% year-over-year.

Outlook and guidance

• Four new titles planned for launch in H2 2024: Seven Deadly Sins: Idle Adventure, King Arthur: Legends Rise, RF Online Next, and Demis Reborn.

• Major updates for Solo Leveling: Arise scheduled monthly from August to December.

• Additional 5-6 projects are in the pipeline for 2025, with details to be announced later.

• Seven Deadly Sins Origin planned for Q2 2025 launch, with coordinated marketing efforts across platforms.

• Continued focus on cost management and efficiency to sustain performance.