April 25, 2024

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[THE INVESTOR] Korean game makers suffered sluggish sales in the first quarter -- usually a high season for the local game industry overall -- amid a near monopoly by Netmarble Games’ latest hit game “Lineage II: Revolution,” according to their regulatory filings on May 17.

Among the nation’s top 10 listed game companies, only three -- Nexon, Wemade and NHN Entertainment -- saw their earnings increase in the January-March period compared to the previous quarter, while seven others posted negative growth. 

Netmarble that made its stock debut on May 12 was not a listed firm in the first quarter.

Industry watchers said their poor earnings were hit hard by Netmarble’s mega hit “Lineage II: Revolution,” while they failed to launch their own hit games. In the first month of the launch in December, the Netmarble earned a record 200 billion won (US$178.5 million) from the mobile game.

NCsoft, the maker of the original “Lineage,” saw its first-quarter operating profit plunge more than 70 percent to 30.4 billion won. While its profits from the 19-year-old PC game are slowing, the company aims to offset the loss with the upcoming launch of the mobile version “Lineage M” in June.

Revenue of Kakao’s game unit fell 14 percent to 80.3 billion won, while Gamevil posted a 25 percent decline to 28.5 billion won. Both firms cited no new launches as the key factor behind the week earnings.

Even three firms that posted earnings growth were found to have increased earnings from royalty sales rather than their own game sales.

By Park Ga-young (gypark@heraldcorp.com)