April 25, 2024

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[THE INVESTOR] Concerns over Netmarble’s earnings will remain until it rolls out new games in the fourth quarter, said Kiwoom Securities on Sept. 5, lowering the target price to 170,000 won (US$152.19) from 180,000 won.

Even when its new game “King of Fighters” manages to gain popularity, revenue may not be able to rebound, as revenue from new games are generally lower while at the same time, those from existing games decline. 
Adding to the woes are the shortened working hours that have added costs and forced game companies to postpone the release of new games. 

In the fourth quarter, though, the game maker will roll out a highly anticipated lineup that will not only boost its earnings but will also offer guidelines for domestic games, said analyst Kim Hak-jun.

“Blade and Soul: Revolution” will show whether MMORPGs could grow further. “BTS World” will be a barometer of whether intellectual property based on celebrities can succeed and “Seven Knights 2” whether a mobile-based IP can be spun off and expanded. Revenue from Netmarble’s new games introduced in the first half has dwindled fast, but it should be able to show better results that could beat expectations in the fourth quarter, added the analyst. 

By Hwang You-mee (glamazon@heraldcorp.com)