Nexon, which was somewhat passive in ‘launching new works’ by focusing on ‘developing stable intellectual property (IP) capabilities’ last year, is starting to reverse the mood. Its strategy is to focus on securing growth engines by launching signature intellectual property (IP) titles targeting the global market, and to strengthen its IP influence by expanding its cultural and content business.
◇Nexon’s operating profit fell by double digits… ‘好好’ thanks to Bitcoin
Nexon announced on the 8th that it recorded 951.6 billion won (91.5 billion yen) in operating profit on a consolidated basis in 2021, down 18% from the previous year. During the same period, sales decreased by 6% to KRW 2.85 trillion (274.5 billion yen), and net profit increased by 104% to KRW 1.194.3 trillion (114.9 billion yen).
Nexon’s operating profit in the fourth quarter of 2021 was 30.9 billion won (3 billion yen), down 81% from the same period of the previous year. During the same period, sales decreased by 18% to 563.9 billion won (54.3 billion yen). Its net profit turned to black at 228.6 billion won (22 billion yen).
The rather sluggish performance is interpreted as a result of a base effect from the highest annual mobile sales record in Δ2020 and a focus on developing new products.
On the other hand, Nexon’s 4Q net profit ‘turned to a profit’ reflecting unrealized gains from bitcoin investment. In April of last year, Nexon Japan invested less than 2% of Nexon’s total cash and cash equivalents in Bitcoin. The number of bitcoins Nexon bought was about $100 million (about 113 billion won), and the total number of purchases was 1717, and the average purchase price was $58,226 (about 65.8 million won).
Nexon, which suffered tens of billions of won in valuation loss due to the continued decline in the bitcoin price, made up for the large loss with the rise of bitcoin at the end of last year. According to Nexon’s 4th quarter earnings report, Nexon’s 4th quarter bitcoin valuation income (estimated) is 1.2 billion yen (about 12.458.52 million won).
Nexon is determined to continue long-term investment in Bitcoin regardless of loss. When Nexon invested in Bitcoin last year, Nexon said, “We plan to keep Bitcoin as a cash asset that can be held for the long term and as a major means of capital allocation strategy.”
◇ Launch of ‘Dunpa Mobile’ to pour global signature IP
Nexon will launch an aggressive offensive with its signature IP title targeting the global market this year. Representatively, ‘Dunpa Mobile’, which is a mobile interpretation of ‘Dungeon & Fighter’ (Dunpa), one of Nexon’s core IPs, will be released on March 24th.
‘Dunpa Mobile’, a highly anticipated game that integrates Neople’s know-how, is an action role-playing game (RPG) that melts the original original’s exciting action into a mobile platform.
A global multi-platform (cross-play between PC and console) racing game ‘Kart Rider: Drift’ is also under development with the goal of releasing it within this year. The game is a next-generation casual racing game that embodies the IP of ‘Kart Rider’, which has 380 million users, with 4K UHD high-resolution graphics.
The third-person shooter game ‘ARC Raiders’ is also scheduled to be released on PC and console (PS5, Xbox Series) multi-platform within the year. The game video of ‘Arc Raiders’, which is being developed at Embark Studios, a Swedish-based development subsidiary founded by EA former Patrick Soderlund, was first unveiled at the North American game event ‘The Game Awards’ (TGA) in December last year, raising expectations from users.
◇ Significantly strengthen the lineup with new works that cross genres and platforms
Netgames’ new multiplayer online role-playing game (MMORPG) ‘HIT2’ (mobile, PC) and ‘Mabinogi Mobile’, which inherited Nexon’s classic IP, are also scheduled to be released within this year.
Nexon said, “The online new ‘Kurtzpel’ has been pre-registration since last January, and ‘DNF DUEL’, which recreated the ‘Dunpa’ IP as a fighting genre, also completed a global open beta test in December.” Additional releases of titles based on IP were announced.
Many titles based on the new original IP are also expected to appear. It is predicted that the MMORPG genre game ‘Project ER’ and the 5v5 team battle-based third-person shooter ‘Project D’ will also be released within this year, with the largest number of developers ever participating.
In addition, although the release date has not been decided, a new title is being prepared that will further strengthen Nexon’s masterpiece lineup. Representative examples include ‘Project HP’, which is being prepared as a unique genre of hand-to-hand combat PvP action, and ‘Project Magnum’, a multi-platform game of the root shooter genre that combines RPG elements with the third-person shooter genre.
Nexon said, “If Neople’s new ‘Dunpa Universe’ such as ‘Project Overkill’ and ‘Project BBQ’, which inherited the worldview of ‘Dunpa’, join the lineup, Nexon will be able to secure additional growth engines.” said.
◇Nexon shot a ‘signal shot’ to leap forward as a comprehensive entertainment company
Nexon, which showed its will to leap from a ‘game company’ to a ‘comprehensive entertainment company’, is also speeding up its IP expansion to become ‘Asian Disney’, the long-time dream of founder Kim Jung-ju.
First, Nexon will promote the creation of various contents by combining the IP of each company with the domestic MCN company sandbox network and fostering influencers. Previously, Nexon made a strategic investment in the sandbox network in 2020.
Efforts to expand Nexon IP to movies and streaming are also expected to continue. As part of this, Nexon recently invested $400 million in AGBO, a global entertainment production company founded by the world-famous film directors, the Russo brothers.
In partnership with AGBO, Nexon said, “By combining IP management know-how acquired through long-term service, one of Nexon’s strengths, global users can enjoy Nexon’s IP through various channels such as games, movies, TV, streaming, and product sales. We will provide opportunities,” he said.
Nexon will also start expanding the metaverse business through YN C&S, a joint venture established in cooperation with YG Entertainment, Naver, WYSIWYG Studio, and NP.
Currently, five companies are building ‘I-DMC’ (tentative name), a futuristic content production facility, in Uijeongbu, Gyeonggi-do. It is analyzed that Nexon will use the infrastructure created by YN C&S to produce content that can expand its IP in various ways.
Owen Mahoney, CEO of Nexon (Japan) said, “2021 was a year in which Nexon focused on developing new technologies, investing in human resources and IP while enhancing the perfection of upcoming works. We will provide greater enjoyment through the Nexon IP,” he emphasized.
